Jetstar to expand in NZ, Virgin exits

Photo / Greg Bowker

SYDNEY - Low-cost carrier Jetstar plans to increase its fledgling New Zealand operations, taking advantage of Virgin Blue's departure from the market.

The airline, owned by Qantas, says it will add two extra A320 aircraft to its eight strong NZ fleet to support more domestic and trans-Tasman routes.

This includes the launch of Melbourne to Queenstown, Gold Coast to Queenstown and Auckland to Cairns services.

Jetstar chief Bruce Buchanan said the airline would increase flights from Auckland, Christchurch and Wellington in advance of the 2011 Rugby World Cup.

"We plan to further grow our existing domestic NZ routes and will investigate new destinations in line with our strong and expanding market presence since commencing domestic flying in June 2009," he said.

The Virgin Blue airlines group said on Monday it was pulling out of an underperforming New Zealand domestic market, to strengthen its trans-Tasman, Pacific and Asian networks.

Jetstar is the second airline to benefit from the move, after Air New Zealand said it would pick up thousands of Virgin Blue's disrupted passengers.

"We have confirmed that we're able to re-accommodate their customers and understand Pacific Blue will soon contact passengers to discuss their options," Air New Zealand Group General Manager Australasia Bruce Parton said in a statement.

He said passengers would be rebooked onto Air New Zealand services as close to their currently booked departure time as possible.

In addition, Pacific Blue passengers would be offered free membership to Air New Zealand's Airpoints program.

Virgin said following the first phase of a network review, its Pacific Blue operation would expand as a medium-haul international airline, while its long-haul V Australia aircraft would be available to strengthen the US route.

"By year-end, V Australia will be fully devoted to international long haul business more suited to the B777 fleet, with Fiji serviced by Pacific Blue," Virgin Blue chief executive John Borghetti said in a statement.

"We are delivering what our guests tell us they need - more capacity and frequency on eastern seaboard capital city routes, and to key tourist destinations such as the Gold Coast and Uluru."

The company said "recent changes to our domestic flight patterns and frequencies now provide more than 490,000 additional seats across the Virgin Blue domestic network".

"As we enter a new era for Virgin Blue, it is vital that we have the right aircraft on the right routes if we are to fully exploit our competitive advantages in the context of the group's three core business: domestic short haul, international medium haul and international long haul," Mr Borghetti said.

"We are adding capacity to routes with strong revenue potential and, accordingly, removing capacity from services which are underperforming."

Key schedule changes would include more flights across the Tasman and to Bali and Thailand, rescheduling V Australia's Sydney-Los Angeles service, daily services on that route from December 10, and extra services between Melbourne and Johannesburg, Los Angeles and Thailand.

Mr Borghetti said more developments were "in the pipeline" and further announcements would be made in due course.

- AAP