You are not permitted to download, save or email this image. Visit image gallery to purchase the image.
The airline's chief commercial officer Cam Wallace said about 34,000 passengers had booked to fly into the resort over the two-week holiday, slightly more than domestic arrivals over the same period last year.
Most were flying from Auckland.
The airline was surprised by the "domestic rebound", Mr Wallace said.
"It’s way ahead of our expectations."
Domestic passenger numbers across the country this week were running at 74% of last year’s numbers.
"We had anticipated a slower recovery, closer to 55%, so it’s quite a material amount better than we anticipated."
He attributed the demand to "travel substitution" by New Zealanders who would normally be flying to Europe, Asia and the Americas at this time of year.
"With Queenstown having such a great breadth and variety of product, this is where we’re getting a lot of customers."
Responding to criticism its fares were too high, Mr Wallace said it was logical for airlines to raise fares during times of high demand, but its prices were "pretty attractive" in the circumstances.
Customers who were flexible about when they could fly could always find cheaper fares.
"Over July, we’ve sold over 15,000 tickets into Queenstown for less than $100.
"It’s not in our best interests to price it so high that we suppress demand."
Because the airline was in survival mode, it wanted to incentivise New Zealanders to travel in order to keep as many of its staff employed as possible and "cash coming in the door".
It was using larger A321 aircraft, normally used on its transtasman routes, to fly into Queenstown, which allowed it to increase capacity easily while lowering per-seat operating costs.
Mr Wallace yesterday met Queenstown Lakes Mayor Jim Boult and representatives from the resort’s airport, chamber of commerce, regional tourism organisation, hotels, ski areas and tourism operators.
A hot topic of conversation was the level of business the airline was expecting over the next three to nine months, he said.
"They’re all very aware that once we get through this peak of the school holidays, we’re going to have another period where we’re going to have to stimulate the local economy again."
When a transtasman bubble was announced by the Government, the airline would resume international flights into Queenstown "as soon as possible".