Originally Posted by
cavemanzk
My biggest issue with NZ pricing is that they are always more than willing to sell excess loss leader fares when they have an competition. Once that competition has gone, fares sharply rise again (same pattern over the last 20 years).
I can get to Queenstown on JQ for around $55 (one way) on sale for an 3 day weekend away. Yet to getting to Nelson for an 3 day weekend, can cost you more than what it used to cost to goto Australia pre-covid-19.
Nelsons issue really is over the next 10 years they are going to grow out to the ATR’s. Now that have that new terminal built with room for security. They need an runway upgrade to enable a320 services.
The Q300 didn’t really work for JQ’s model, although an daily JQ A320 on AKL-NSN in summer would likely do very well.
Sure they are losing $2million a day, although assume that is mainly from International? Sure my domestic is now breaking even at the moment.
I doubt NSN will ever get an A320 service. Better to build up the frequency of turboprops to offer more options. E.g. WLG-CHC is turboprops except a rush hour A320, so don't need at 15min frequency for a couple of hours to get through the glut of people.
Plus want the ground staff always working with a high frequency of planes not sitting around with longer breaks for bigger planes. Also more smaller fights means less people in the lounge, got get gluts of people.
How would a daily A320 AKL-NSN service work? As with a tourist pattern people will want to fly in mid morning and fly out mid afternoon. Don't want a plane sitting on the apron all day. The A320 to IVC works as is a business flight and sits at IVC over night when wouldn't be flying anyway.
That is what get with monopolies. NZ needs a second airline which can compete on frequency not just price. I think JQ failed as could get the cost sensitive flyers, but not enough flights/times/connections to get the next group of people who happy to pay more for a time period that suits them better. Then the final group who will fly at a particular time regardless of cost.
Doesn't really matter where the $2m is being lost the board and CxOs have a legal requirement to keep the business solvent. If a sale isn't going to get more pax to end up with more money for the flight than without the sale, it is going to make things worse.