The Prime Minister says the attitude of a rental car company towards the parents of two men killed at Fox Glacier is crass and bad business practice.
The Christchurch company is billing the parents of the pair, who were crushed beneath collapsing ice at Fox Glacier on 8 January, $700 for the return of the vehicle.
The keys were buried with the men and the car had to be towed back to Christchurch.
The tow cost $700, which New Zealand Rental Car Specialists director Edwin Chan says is a burden for the business.
However, Mr Key, who is also tourism minister, says the company could have shown more compassion and looked past its legal rights.
He says it was crass at best and extremely bad business practice.
Publicity generated by the case has prompted one Queenstown person to offer to reimburse the families for the towing cost.
Victim Support chief executive Tony Paine says it is is a positive outcome and he is pleased the individual has come forward.
Tourism Industry Association chief executive Tim Cossar says he would like to think that businesses show a reasonable degree of compassion in recovering costs in such exceptional cases.
The Rental Vehicles Association says the situation highlights the importance of travel insurance.
Boy racer problem in spotlight
Meanwhile, a German documentary about boy racers in Christchurch has sent shudders through the tourism industry.
The story, which aired on German television last week and is also online, depicts Christchurch as an idyllic city by day but as overrun by boy racers after dark.
Christchurch and Canterbury Tourism chief executive Christine Prince says the number of German tourists visiting Canterbury has been growing, and she does not believe the documentary will put off too many visitors from coming to the region.
However, Ms Prince says the fact the story has made it into the international media means it cannot be ignored.
She says she is disappointed the film crew chose to focus on the boy racer problem.