Dunedin International Airport chief executive John McCall
is considering the implications of the Government's decision to
authorise a transtasman alliance between Air New Zealand and
The new alliance was announced by Transport Minister Gerry
Brownlee, and brought an end to capacity conditions
previously imposed on the airlines.
They were granted a three-year alliance in 2010, which
included capacity conditions so transtasman flights had to
operate on some less competitive routes, as well as the main
routes in and out of Auckland, Wellington and Christchurch.
In a submission to the Ministry of Transport earlier this
year Mr McCall opposed unconditional reauthorisation of the
alliance, as sought by the airlines.
He said the public benefited in some ways from the alliance,
but there needed to be capacity conditions imposed so
vulnerable markets such as Dunedin were not exposed to ''the
potential for collusive capacity restriction and the price
increases which could result''.
''Any reauthorisation should be accompanied by appropriate
capacity conditions, as put forward by the applicants in the
original authorisation process - the Dunedin-Brisbane route
was included in these conditions.
It is only in this way that the travellers using the routes
most vulnerable to anticompetitive behaviour can be protected
from the significantly enhanced market power achieved by the
applicants under an authorised alliance,'' he said.
Mr Brownlee granted the new alliance for the period until
October 31, 2018, to coincide with the expiry of a similar
alliance between Qantas and Emirates.
He said Air New Zealand and Virgin Australia were subject to
conditions imposed by the Australian Competition and Consumer
Commission and, therefore, it was not necessary to impose
capacity conditions on the New Zealand Government-authorised
''I am satisfied that the conditions imposed by the
Australian Competition and Consumer Commission are sufficient
to ensure that the airlines continue to operate in a
The airlines had agreed to provide detailed operational data
to the Ministry of Transport every six months under the new
agreement, which could be revoked by him if airlines failed
to comply, Mr Brownlee said.