New Zealand is facing a public outcry over soaring airfares, with many citing the costs as "extortionate" and "horrendous." The issue is impacting various sectors, from sports teams struggling to afford travel to couples facing significant costs to visit each other. The Otago Daily Times reports that some are even choosing cheaper reunions in Australia to avoid expensive domestic flights.
Calls are growing for the New Zealand government, a major shareholder in Air New Zealand, to address the problem. Several MPs have voiced concerns, with some calling for a "please explain" to the airline and suggesting the government use its influence to ensure more affordable flights, especially to southern regions. Regional Development Minister Shane Jones has been inundated with complaints and plans to raise the issue with other ministers. The government's bailout of Air New Zealand during the pandemic is also being factored into the calls for action.
Industry experts argue that Air New Zealand's monopoly on many domestic routes is a key factor in the high prices. They highlight the lack of competition compared to other sectors and suggest that market studies and support for smaller airlines are necessary to address the issue and bring competition back to the market.
Air New Zealand attributes the high fares to significant operating costs, including fuel and labor, and recommends booking flights early to secure better deals. The airline's approach is based on a supply and demand pricing model.