The price of last-minute air fares out of Dunedin is upsetting some travellers, and prompting renewed calls for competition.
Chamber of Commerce chief executive John Christie said several Dunedin businesses had contacted him during the past fortnight "to express their dissatisfaction" over the price of last-minute Air New Zealand domestic fares.
The withdrawal of Pacific Blue domestic services ended competition on the Dunedin domestic sector and prices on Air NZ flights "crept back up", he said.
"When you take competition out, there is a temptation to raise fares because they hold a monopoly."
While travellers expected to pay a premium for last-minute fares, $900 for a return trip to Auckland was too much, he said.
A search of Air NZ's website last night showed a one-way ticket from Dunedin to Auckland today ranged from $397-$522.
By comparison, a one-way ticket booked now for the first Monday in January would cost about $272, February about $125 and March about $104.
An Air NZ spokeswoman said the average fares into and out of Dunedin were lower than at the corresponding time last year.
"As a result of Pacific Blue customers now flying with Air NZ, the cheaper air fares are selling out quicker as there is now more demand for them."
An extra daily service between Auckland and Dunedin from February 7, resulting in a 43% increase in the number of seats available, "should help to address the high demand ... for travel on this route".
Mr Christie said prices were also impacting on tourists, students wanting to return home, and the ability of Dunedin consumers to access international flights out of Auckland.
He had also heard of a family of four opting to drive from Auckland to Dunedin rather than pay nearly $2000 for last-minute flights to the city.
The introduction of competition on the Dunedin-Brisbane route had helped reduce fares and increase passenger numbers on the transtasman sector, he said.
Dunedin International Airport chief executive John McCall said people were commenting "all the time" about air fares since the withdrawal of Pacific Blue from the domestic market.
Since Pacific Blue's departure, Air New Zealand had not increased capacity "but there is still demand for the services and they are pricing accordingly".
"In a way, it is very good business."
Air New Zealand will increase capacity from Dunedin next year, and the airport remained "on the radar" for low-cost carrier Jetstar.
A Jetstar spokeswoman said the carrier was "always looking at opportunities that support its everyday low fares proposition across its New Zealand and international network".
The airline was focused on strengthening its existing New Zealand domestic network, which included new frequencies from this month.
"We've expressed interest in expanding to more New Zealand destinations. However, nothing is confirmed at this stage."
Jetstar chief executive Bruce Buchanan told the Otago Daily Times in September Dunedin, Invercargill, Hamilton, Rotorua, and Nelson were all domestic destinations "on our list".
The Qantas subsidiary operates between Auckland, Wellington, Christchurch and Queenstown.
