Air New Zealand has a "Plan B" if its proposed alliance with Virgin Blue is turned down by regulators either here or in Australia, but it's a "poor man's version", chief executive Rob Fyfe says.

Speaking at its annual meeting in Auckland yesterday, Mr Fyfe responded to a shareholder's question on the company's contingency plans by saying the two airlines could potentially collaborate on a lower level without triggering anti-competitive alarm bells.

The Australian Competition and Consumer Commission [ACCC] stated earlier this month that it would deny authorisation for the alliance on the grounds that it was likely to reduce competition in the trans-Tasman market.

Mr Fyfe said the airlines could use each others' distribution infrastructure in their respective trans-Tasman ports to make it easier for passengers to link from one carrier's flight to another.

But he warned any Plan B would be a "poor man's version" of the original proposal by the airlines to form an alliance that would see the two carriers collaborate on pricing, revenue management, schedules, capacity and routes.

He also said Air New Zealand's new flexible pricing product – Seat to Suit – on the routes is another pillar of the company's strategy to make its trans-Tasman operations profitable.

Passengers can choose to book a seat only or add baggage for a fee, or pay for "The Works" – the equivalent of the current economy offering with one checked bag, a meal, drinks, and in-flight entertainment. The `Works Deluxe' adds lounge access and more personal space.

Seat to Suit had been trialled recently between Christchurch and Sydney, and despite some teething problems, Mr Fyfe hoped it would make Air New Zealand more competitive at both the low and high end of the market.

"If we can't get the alliance up, we will certainly pursue those sorts of alternatives, but they won't allow us to present a fully functioning alliance to directly reflect what it is Qantas and Jetstar are doing today and would leave us at a competitive disadvantage."

Mr Fyfe said the airline had reduced its trans-Tasman capacity by 15 per cent in the past two years and its market share on the routes had been declining over the past five years.

He said that the ACCC was at risk of "killing off" competition rather than promoting it, and that the regulator's position put Air New Zealand in the position of having a hand tied behind its back.

Air New Zealand reiterated the alliance would increase overall passenger numbers and enhance services and products via an integrated Australasian network.

In response to another shareholder question, Mr Fyfe said the company had considered starting its own network in Australia but the cost would be prohibitive.

Air New Zealand had submitted its response to the ACCC's draft determination, and awaits the Transport Ministry's position on the alliance with Virgin Blue.

Emergency services have been called to Woodbourne Airport, near Blenheim, after reports of mechanical problems on a plane.

The Press understands a Dash 8 aircraft experienced difficulties with its nose-wheel as it landed about 5.25pm.

However, a spokesman for Police Southern Communications said he understood no-one had been hurt.

Plane crash-lands near Blenheim

A plane with 46 passengers and three crew on board has crash-landed at Woodbourne airport near Blenheim this evening.

The plane, operated by Air Nelson, a subsidiary of Air New Zealand, was bound for Nelson from Wellington but had been diverted to Blenheim due to bad weather in Nelson.

The plane suffered nosewheel failure, meaning the wheel collapsed on landing at Blenheim airport.

Passengers kept in the Dark

http://www.stuff.co.nz/national/4188...s-kept-in-dark

Emergency landing at Auckland airport

An Air New Zealand plane carrying 40 people made an emergency landing at Auckland Airport after a battery overheated this afternoon

http://www.nzherald.co.nz/nz/news/ar...ectid=10681872

AIR NEW ZEALAND JOINT VENTURE AGREEMENT ENDS FOR TBU/APW-LAX SERVICES


The Kingdom of Tonga has given notice that it wishes to terminate the joint venture agreement supporting the weekly Air New Zealand service connecting Nukualofa and Apia with Los Angeles. The service will be suspended at the end of January 2011.

For the past two years Air New Zealand has been in a joint venture agreement whereby the Kingdom of Tonga and the Government of Samoa have financially supported the operation of this service. The parties recently concluded negotiations on a new three year agreement to commence on 1 November 2010; however the Kingdom of Tonga has now chosen to activate the termination clause because it is unwilling to continue to help fund any continuing losses.


Airpoints customers holding redemption and/or companion tickets will be offered the same as above. All re-accommodation and reissuing will be transacted by Airpoints.


Air New Zealand thanks the Kingdom of Tonga and the Government of Samoa for participating in this agreement for the past two years and regrets that the arrangement is no longer financially viable for some of the parties. The Governments of Samoa and Tonga wish to express their appreciation of the financial support that they have received from the New Zealand Government to support this service.


Air New Zealand will continue to operate its return services from Auckland to Samoa and Tonga as normal.