Air New Zealand Air Points - Emirates bid may help NZ/QF merger along

In today's Australian Financial Review (can't find the story on their website, so will copy a summary):

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">The federal government is considering a deal with Emirates Airlines that could boost the chances of a merger between Qantas and Air New Zealand by introducing greater competition on flights across the Tasman.

The deal would allow Emirates to double its flights to Dubai out of Sydney and Melbourne in return for the airline launching services between Australia and New Zealand.</font>

The article goes on to say that bilateral talks are ongoing between Aus and UAE, and that Qantas is vigorously opposing increased traffic rights for Emirates as it may hurt QF's very profitable 'kangaroo route' to Europe.

When EK takes delivery of its new A345s shortly it will be able to offer direct SYD/MEL - DXB flights, or a 1 stop service to Europe, which will make it far more competitive than the current 2-stopper which also goes via SIN. It would be interesting to see EK trans-Tasman - they might shake things up a bit!

Sounds like politics and airline spin to me

Emirate’s could likely increase flights out of MEL if it wanted. As for SYD, the problem of slots remain, unless QF or NZ give time slots to Emirate’s(now how likely is that!!)

Also your title to this post is wrong. A merger is between equals, and Air NZ does not equal QF. The proposal is QF taking 22% of Air NZ and being dominate force in the Air NZ operation, as well as injecting cash into Air NZ. Without a big heap of cold hard cash, Air NZ will become basically a domestic carrier with only 1 international flight to London via the US


[This message has been edited by Mwenenzi (edited 05-25-2003).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Mwenenzi:
Sounds like politics and airline spin to me</font>

Probably true... but interesting prospect nonetheless.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Mwenenzi:
Also your title to this post is wrong. A merger is between equals, and Air NZ does not equal QF. The proposal is QF taking 22% of Air NZ and being dominate force in the Air NZ operation, as well as injecting cash into Air NZ.</font>

I'm just using the title as used in the AFR! In a sense it is a merger of QF's operations into and within NZ with AirNZ's operations... but I know what you mean.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Mwenenzi:
Without a big heap of cold hard cash, Air NZ will become basically a domestic carrier with only 1 international flight to London via the US</font>

This assertion is repeated willy nilly, but I have to say I don't buy it. Ralph Norris first came up with it as a bit of media scaremongering to drum up support by appealing to patriotic / parochial NZ sentiments. No-one has yet come up with any justification for the claim, as well as conveniently ignoring the fact that AirNZ even in its current delicate state is doing far better than many other airlines around the world. The assertion that only the biggest airlines will survive is also a bit problematic, given that most of the success stories in aviation these days are agile small to medium size airlines (like EK, for example).

Most of NZ's international routes may not be very profitable, but it needs the international feed for its (profitable) domestic network.

Having said all that, there is no doubt that NZ needs a hefty dose of capital to fund fleet upgrades and product updates and improvements for its long haul offering (PTV's in Y / beds in J / suites in F, or perhaps a 2 class format with much improved premium-business product) and that cash has to come from somewhere...

[edited for my usual UBB boo-boos]

[This message has been edited by mad_atta (edited 05-26-2003).]

EK, u have my support.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Laserjet:
EK, u have my support.</font>

And the Aussie government's too, judging by this story (http://www.nzherald.co.nz/storydisplay.cfm?storyID=3504602&thesection=news&thesubsection=general) in the NZ Herald:

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Emirates granted right to fly trans-Tasman

29.05.2003
1.00pm
SYDNEY - The Australian government has granted Emirates Airlines the right to fly trans-Tasman routes from any port in Australia.

Few details were available this morning on the decision, but the Australian Financial Review said Federal Transport Minister John Anderson had knocked back the airline's application to fly twice a day from Sydney to Dubai.

However, Emirates will be able to operate twice daily services to Dubai from Melbourne, Brisbane and Perth to take effect from October.

The decision to allow Dubai-based Emirates to fly trans-Tasman routes out of Australia will provide extra competition, which both Qantas and Air New Zealand have conceded in their updated bid to get their equity deal approved by competition regulators in Australia and New Zealand.

Air New Zealand spokesman Glen Sowry said Emirates would be joining several other airlines offering services across the Tasman, the Daily Telegraph reported.

But whether there will be enough competition against an Air NZ-Qantas operation to satisfy the regulators remains to be seen.

Emirates can already fly to New Zealand under an open skies agreement with the United Arab Emirates, but up until now Australia had refused permission for it to fly the trans-Tasman routes.

The decision not to allow it Sydney-Dubai service is likely to have been made to appease Qantas, which wants to protect its position on the so-called "kangaroo" route to London.

Mr Anderson has agreed to reconsider the Emirates' Sydney-Dubai request within 12 months.

- NZPA </font>

Watch this space!

With Emirates now competing against Qantas on the Australia-Europe market, I say QF will be under tremendous pressure to upgrade its services and products. While EK may not be able to fly out of SYD direct to DXB, a significant amount of business can still be picked up from BNE, MEL and PER. Because Dubai is EK's hub, travellers from Australia will have a much better connection to continental Europe with more choices of destinations than QF who can only carry pax to LHR, FCO, CDG or FRA.

On the other hand, EK's First product, if the flat bed is introduced on the new aircrafts, will be so much superior to QF in every aspects. Food for one, there will be no comparison that EK is the best. Service of EK is reknown while QF, while good in First, can be inconsistent in Business. The only downside with EK is the lack of a good frequent flyer program. EK has one of the least attractive FF program and lack of an alliance. So if I have to fly this route, I might be forced to fly QF over EK. But I am sure if EK joins an alliance like *A, then the choice would be easy then.

If EK flies Trans-Tasman, I will pick them anyday.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Guava:
While EK may not be able to fly out of SYD direct to DXB, a significant amount of business can still be picked up from BNE, MEL and PER. On the other hand, EK's First product, if the flat bed is introduced on the new aircrafts, will be so much superior to QF in every aspects. Food for one, there will be no comparison that EK is the best. Service of EK is reknown while QF, while good in First, can be inconsistent in Business.</font>

EK's current SYD-SIN-DXB will become a nonstop SYD-DXB in October with the introduction of their A345 into service. This craft will also introduce the new F and J cabins to the EK fleet with retrofitting taking place of other fleet types thereafter. EK's other "drawcard" if you want to call it that has to be the duty free in DXB, the best I've ever seen anywhere. If you have to stop on the way to Europe I'd gladly stop in DXB rather than SIN/KUL/BKK on the way over.
Cheers.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Al B:
EK's current SYD-SIN-DXB will become a nonstop SYD-DXB in October with the introduction of their A345 into service. This craft will also introduce the new F and J cabins to the EK fleet with retrofitting taking place of other fleet types thereafter. EK's other "drawcard" if you want to call it that has to be the duty free in DXB, the best I've ever seen anywhere. If you have to stop on the way to Europe I'd gladly stop in DXB rather than SIN/KUL/BKK on the way over.
Cheers.

</font>

I thought this article clearly states that EK will not be allowed to fly SYD-DXB direct because Canberra wouldn't allow it to appease QF. So it seems SYD-DXB will have to remain a one stop service via SIN but MEL-DXB or PER-DXB can be non-stop if EK so desires.

Am I interpreting this correctly?

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Guava:
I thought this article clearly states that EK will not be allowed to fly SYD-DXB direct because Canberra wouldn't allow it to appease QF. So it seems SYD-DXB will have to remain a one stop service via SIN but MEL-DXB or PER-DXB can be non-stop if EK so desires.

Am I interpreting this correctly?</font>

No, there is nothing stopping EK from offering nonstop flights SYD-DXB. What the government has done is to decline EK's application to *double* it's number of SYD-DXB flights, whether direct or via SIN.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Al B:
EK's other "drawcard" if you want to call it that has to be the duty free in DXB, the best I've ever seen anywhere. If you have to stop on the way to Europe I'd gladly stop in DXB rather than SIN/KUL/BKK on the way over.
Cheers.

</font>

And the EK lounges in Dubai are fantastic, supposedly as good as the Wing. Dubai is also a great city for stopovers, definately quite exotic and lots to do. Definately a good choice on the kangaroo route (they even use NZ's lounge in Sydney http://www.flyertalk.com/forum/wink.gif).

Have any of you actually flown EK in F and used those "fantastic EK lounges as good as The Wing"? I have, and they are not. EK food is not competitive with CX and comparable to QF. There are fantastic EK lounges but they are not available to normal F passengers. You have to be a VIP to get into the fantastic lounges (think high roller suite in Vegas). For a purchased F ticket you don't get access, and the lounge they do provide is nice but comparable to the QF international F lounge (maybe slightly better) and nowhere near Wing quality. EK is greatly over-rated, and to my taste the duty free shopping in HKG is better (similar or cheaper price for the items I buy and similar selection). The big bargain at DXB is caviar, and gold jewelry.
Sure EK will shake up the market, but only a little bit. I wouldn't fly them Australia-Europe for lots of reasons, and they aren't as good as BA DXB-LHR.

Incoming!!!!!

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">JUNE 9, 2003

EMIRATES TO FLY TO NEW ZEALAND FROM AUGUST 1

From that date, Emirates' daily flights to Sydney and Melbourne will be extended on to Auckland providing a total of 14 flights weekly in each direction.

Emirates daily flights to Brisbane, scheduled to start October 26, will also be extended to Auckland, increasing Emirates' services across the Tasman Sea to 21 weekly. The airline has full traffic rights between Auckland and all three Australian gateways.

Sheikh Ahmed said: "The UAE and New Zealand have enjoyed an air services agreement for some years. These new services follow the recent agreement on traffic rights between the governments of Australia and the UAE, which allows Emirates to operate with full traffic rights from all points in Australia. Our flights offer Australian and New Zealand passengers a greater choice of carrier across the Tasman Sea. I am grateful to the Australian Government for the opportunity this affords us to extend trade and leisure travel opportunities in this increasingly popular region of the world."

Sheikh Ahmed added: "When Emirates introduces non-stop flights to Sydney on October 26, we will offer an unrivalled one-stop service between Dubai and New Zealand."

Emirates, is based in Dubai, a total open skies environment. The airline has never received protection or financial subsidy from the Dubai Government. Yet, it is not only among the world’s fastest-growing airlines, it is also one of the world's five most profitable.

The new services will delight the New Zealand community in the UAE, increase trade between the two countries and open up a stunningly beautiful and extremely safe destination for leisure travellers from the Middle East.

They will also offer passengers to Auckland a choice of departure times from Dubai, varying with the three different gateways used. The flights will be operated with a Boeing 777-300 aircraft in three-class configuration offering 18 First, 42 Business and 320 Economy seats plus cargo capacity of 17 to 20 tonnes.

Auckland, located on New Zealand's North Island, is called the City of Sails because of its extensive sailing and water sports facilities. Not only is it New Zealand's business capital, the city was recently ranked fifth-equal (alongside Copenhagen, Frankfurt, Bern and Sydney) in the annual quality-of-life survey of 215 cities by the global consultancy Mercer Human Resource Consulting.

Auckland's fertile valleys and offshore islands are home to award-winning wineries. Family attractions abound and the city has plenty of adrenaline for adventure lovers. Auckland also offers shopping, nightlife and unrivalled cuisine. Auckland's international airport offers a wide range of restaurants, shops and recreational facilities for both adults and children plus care for passengers with special needs. These include playgrounds and day-rooms for children, a museum, golf and a gym.

Emirates flights schedules are as follows, with all times given being local.

Flights via Sydney
Daily flights will depart Dubai at 0815, arrive Singapore at 1935, depart Singapore at 2045 and arrive Sydney at 0605 the following day. The flight will then depart Sydney at 0735 and arrive Auckland at 1225.

Return flights will depart Auckland at 1750, arrive Sydney at 1905, depart Sydney at 2020, arrive Singapore at 0215 the following day, depart Singapore at 0325 and arrive Dubai at 0625. These flights will be operated with a Boeing 777-300.

With the introduction of the super long-range Airbus A340-500 on the route from October 26, flights will depart Dubai at 1015 and arrive Sydney at 0710 the following day. Flights will depart Sydney at 0835 and arrive Auckland at 1330.

The return flights will depart Auckland at 1935, arrive Sydney at 2045, depart Sydney at 2200 and arrive Dubai at 0540 the following day.

Flights via Melbourne
Daily flights will depart Dubai at 0220, arrive Singapore at 1405, depart Singapore at 1520 and arrive Melbourne at 0035 the following day. The flights will depart Melbourne at 0830 and arrive Auckland at 1400.

The return flights will depart Auckland at 1600, arrive Melbourne at 1750, depart Melbourne at 1905, arrive Singapore at 0100 the following day, depart Singapore at 0210 and arrive Dubai at 0515.

Flights via Brisbane
Starting October 26, flights will depart Dubai at 0830, arrive Singapore at 1935, depart Singapore at 2045, arrive Brisbane at 0605 the following day, depart Brisbane at 0735 and arrive Auckland at 1330.

The return flights will depart Auckland at 1835, arrive Brisbane at 1900, depart Brisbane at 2015, arrive Singapore at 0145 the following day, depart Singapore at 0300 and arrive Dubai at 0620.</font>

Source: the news section (http://www.emirates.com/AboutEmirates/EmiratesNews/news_20363.asp?ComponentID=20363&SourcePageID=955#1) of the EK website.

These guys really don't hang around! It will be interesting to see what resulting fare sales we'll see. How will AKL international cope with an extra 3 777s departing within such a short time of each other, I wonder? And will EK actually make any money on the routes?