Watchdog ruling threat to future - Air NZ From: AAP September 22, 2010 3:26PM Increase Text SizeDecrease Text SizePrintEmail Share Add to DiggAdd to del.icio.usAdd to FacebookAdd to KwoffAdd to MyspaceAdd to NewsvineWhat are these?AIR New Zealand chief executive Rob Fyfe says the Australian competition watchdog's draft determination to block an alliance with Virgin Blue would threaten the airline's future. "If we are to earn the right to continue to fly and grow, then the deal with Virgin Blue is a central plank of that strategy," Mr Fyfe said at a National Aviation Press Club lunch in Sydney today.
"Obviously the ACCC's (Australian Competition and Consumer Commission) preliminary finding represents a threat to this strategy, in effect, a threat to our future."
Virgin Blue and Air New Zealand hope to form an alliance on trans-Tasman services that would see the two carriers collaborate on pricing, revenue management, schedules, capacity and routes.
The Australian Competition and Consumer Commission said in a draft ruling on September 10 that Virgin Blue and Air New Zealand's proposed alliance was "likely to reduce competition in the market for trans-Tasman air passenger services".
Start of sidebar. Skip to end of sidebar. Related CoverageVirgin seeks Delta extension The Australian, 6 days ago Virgin presses ahead with alliances Herald Sun, 7 days ago Life in alliance push yet: Borghetti The Australian, 7 days ago Australian airlines 'need alliances' Adelaide Now, 8 days ago Virgin flight path blocked The Australian, 10 Sep 2010 .End of sidebar. Return to start of sidebar. The ACCC said the alliance was likely to result in some public benefits, such as cost savings and efficiencies, but it had "doubts about the magnitude of these benefits".
Interested parties have until Friday, September 24 to respond to the draft ruling.
"We welcome the invitation from the ACCC to present further information in support of our proposal," Mr Fyfe said.
The proposed tie-up also requires approval from New Zealand's Ministry of Transport.
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