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Wellington Airport October 2006 Traffic Statistics

13 Nov 2006

Wellington Airport October 2006 traffic figures have been posted on the Infratil website.

Passenger volumes remain flat, with very subdued domestic and transTasman markets. Domestic passengers for October fell by 1.8% for the month, bringing year to date growth to -0.2%. Load factors for the month were 73.9%.

International passengers for October fell by 0.1%, with an overall load factor of 75.9%. Year to date growth for international passengers now sits at -3.0%.

The Australian Competition & Consumer Commission recently released its draft determination on the Tasman "code share". While the matter is far from over, the ACCC's findings are highly significant. In a comprehensive draft decision, the ACCC concluded that:

  • there are substantial public detriments from the "code share" in the form of price increases and less customer choice;

  • only very minor public benefits, the most likely being limited cost savings to airlines, which would not be passed
    on to consumers;

  • there is in fact very limited constraint on Qantas and Air New Zealand on the Tasman, other than competition between those two airlines;

  • for all the fuss about "empty planes", the load factors on the Tasman appear quite normal in the airline industry.

Qantas has said it expected that decision. Air New Zealand said it was "flabbergasted" and media reports suggested that they may cut services or raise fares in response. The ACCC addressed that prospect and concluded that any cuts to services would be considerably worse under a "code-share" than if it were rejected. If the "code-share" does not proceed, airlines will no doubt consider services in light of yields, customer demand and profitability, as would be expected.

The ACCC vindicates the position taken by opponents of the code-share, often in the face of extensive criticism by airlines. The anti-competitive agreement requires approval on both sides of the Tasman. There is still a risk that the New Zealand Government take a different line to the ACCC, although that would be truly remarkable given that the impact on New Zealand consumers and businesses would be even worse than on Australians. Despite public calls for Air New Zealand to drop the code share proposal, it is quite possible that the airlines will carry on and appeal the ACCC decision. Should that occur, concerned parties, including Wellington Airport, will need to be prepared to continue and increase efforts to defend airline competition
on the Tasman.
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