21 Dec 2010

Air NZ's deal with Virgin Blue gets go-ahead

7:00 pm on 21 December 2010

Transport Minister Steven Joyce has given his approval to a trans-Tasman tie-up between Air New Zealand and Virgin Blue.

The approval was the final hurdle for the deal, which will involve the airlines co-ordinating routes, prices and schedules as part of a code-share agreement.

Passengers will also be able to use both airlines' frequent-flyer and lounge access schemes.

Australia's Competition and Consumer Commission approved the deal last week.

Mr Joyce says the three-year authorisation period will place a strong incentive on the two airlines to operate in a competitive manner.

He says however that both New Zealand and Australian authorities have been convinced there will continue to be sufficient competition in the aviation market.

Both Air New Zealand and Pacific Blue had argued that if the alliance wasn't approved, they'd have to review a number of trans-Tasman routes.