Australia's Virgin Blue and Air New Zealand (ANZ) plan to launch a trans-Tasman alliance, and will apply for regulatory approval today.
The alliance will allow the carriers to work together on route and product planning, code sharing and frequent flyer programme benefits, they say.
They will file applications with the Australian Competition and Consumer Commission and the New Zealand transport ministry today, the airlines add.
The authorities will likely take about six months to review the applications, say the carriers.
Under the alliance, the carriers will launch a code share arrangement covering all Tasman sectors operated by either airline, and domestic Australian and New Zealand sectors as part of a connecting Tasman journey.
Revenue generated from all Tasman sectors operated by either airline will be allocated between the two carriers, and a joint trans-Tasman network planning and revenue management team will oversee the Tasman operation.
The carriers will also launch a frequent flyer programme which will offer reciprocal benefits for members of both airlines' loyalty programmes, as well as a lounge co-operation agreement.
The alliance, however, will not cover domestic-only travel in either Australia or New Zealand, and the two carriers do not plan to take a shareholding in each other, say the airlines.
"By combining our New Zealand customer base with the strong market presence that Virgin Blue has in Australia, additional flights and new routes will make sense much more quickly," says ANZ's CEO Rob Fyfe.
"The ability to offer Air New Zealand codeshare flights to domestic destinations in Australia, and Virgin Blue codeshare flights to regional destinations in New Zealand as part of connecting Tasman journeys will be a great benefit to our frequent flyers and a boost for tourism in both countries."
Virgin Blue's CEO Brett Godfrey says the alliance will stimulate more competition in the Australasian aviation industry.
"A great alliance should deliver great value and consistent product and service standards and that is where we will make new inroads," he adds.
Source: Air Transport Intelligence news
