Virgin Australia, Air New Zealand to end seven-year alliance



Air New Zealand (AIR.NZ) said on Wednesday it would end its seven-year alliance with Virgin Australia Holdings (VAH.AX) covering flights between the two countries.

The joint venture, which allowed for schedule and pricing coordination as well as codeshares, expires in October and the parties will not apply to renew the alliance, the New Zealand airline said.

Virgin Australia said Air New Zealand had notified it of the end of the alliance, in which the Australian carrier was the smaller partner. It rivaled a competing joint venture between Qantas Airways Ltd (QAN.AX) and Emirates which received an additional five-year authorization in March.

Virgin Australia CEO John Borghetti said the end of the alliance “provides opportunities for the Virgin Australia Group on the Tasman, including operating both the Virgin Australia and Tigerair Australia brands in the market”.

Air New Zealand Chief Revenue Officer Cam Wallace said the market dynamics on flights between Australia and New Zealand had changed and the time was right for each airline to focus on its own objectives.