ACCC Approves Virgin Australia-Air New Zealand Codeshare

The Australian Competition and Consumer Commission (ACCC) has approved a codeshare agreement between Virgin Australia and Air New Zealand.

This now offers travellers more options and potentially lower fares when flying between Australia and New Zealand (trans-Tasman routes).

Green Light for Trans-Tasman Codeshare

This decision follows the ACCC’s draft determination in May, which received broad public support.

Under the agreement, Virgin Australia can place its code on Air New Zealand flights operating on trans-Tasman routes originating in Australia (VA-coded services).

However, Air New Zealand will have the authority to set the fares that Virgin Australia can offer.

“This collaboration between airlines is expected to bring significant benefits to consumers by increasing competition and offering a wider variety of ticketing and pricing options,” said ACCC Deputy Chair Mick Keogh.

Photo Credit: Virgin Australia

The agreement also allows Virgin Australia and Air New Zealand to jointly provide discounts and marketing initiatives for businesses.

Additionally, eligible Virgin Australia Velocity Frequent Flyer members will enjoy program benefits and access to international lounges on qualifying flights.

It’s important to note that this codeshare arrangement excludes routes where Virgin Australia currently operates or plans to operate its own services in direct competition with Air New Zealand.

“The ACCC believes these conditions effectively mitigate the risk of anti-competitive behavior arising from this agreement,” added Mr. Keogh.

A Virgin Australia Boeing 737 taxiing at Sydney Airport.
Photo Credit: Mitchul Hope, CC BY-SA 2.0, via Wikimedia Commons

Background Information

Virgin Australia primarily focuses on domestic and short-haul international flights within Australia and neighbouring regions.

Their current international destinations include Queenstown (New Zealand), Tokyo (Japan), Nadi (Fiji), Denpasar (Indonesia), Port Vila (Vanuatu), and Apia (Samoa).

Virgin Australia also has existing codeshare agreements with several airlines for long-haul international flights.

An Air New Zealand flight sits on the tarmac at Auckland Airport during Cyclone Gabrielle.
Photo Credit: Air New Zealand

These agreements allow Virgin Australia to market and sell seats on flights operated by partner airlines, with the partner airlines setting the fares.

Air New Zealand, the national carrier of New Zealand, operates flights across the Pacific, Asia, and North America, in addition to its trans-Tasman services.

They are part of a larger airline alliance involving Star Alliance and 26 other international airlines, including United Airlines and Cathay Pacific.

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