Latest Air NZ-Qantas plan goes to regulator today

By CHRIS DANIELS aviation writer

Air New Zealand and Qantas resume their battle today to win regulatory acceptance of their alliance plans.

The New Zealand airline is expected to deliver its latest submission to the Commerce Commission this afternoon.

After expected discussions with the competition regulator about what sections can be kept confidential, details should be made public early next week.

All parties have been asked to comment on the commission's initial strong rejection of the Qantas-Air New Zealand plan, delivered in April.

Qantas wants to buy up to 22.5 per cent of Air New Zealand, which is 82 per cent owned by the Government.

Since the commission rejected the airline's plans, Air New Zealand has issued a series of undertakings it hopes will convince the regulators to allow Qantas to buy into it.

These include promising to provide gates, check-in counters, ground facilities and landing slots.

The two airlines have promised not to increase capacity on any route for 18 months following a new entrant "announcing its intention to enter the route".

Air New Zealand has promised not to let its subsidiary Freedom Air restart domestic service in New Zealand, or to increase its fleet by more than one aircraft a year.

What it has not promised is the one thing that rival Virgin Blue says is necessary for it to withdraw its opposition - the sale of Freedom Air.

The Air New Zealand and Qantas plans were dealt an unexpected blow last week, when the commission said it had recalculated the estimated detriment of the alliance - and it was worse than first thought.

The commission now says the total cost of an alliance to the economy would be in the range of $195.4 million to $466.5 million.

* Air New Zealand yesterday released its operating statistics for last month.

Traffic across the group increased 1.4 per cent compared with the same month last year.

Capacity across the group, which is measured by available seat kilometres, was up 6.9 per cent.

Load factors were down 3.5 per cent, due mainly to the Sars virus cutting travel to and from Asia.

So far this year traffic is up 5.7 per cent, and load factors are up 2.4 per cent.