Virgin blue pulls out of nz
Travellers who hold air tickets on Pacific Blue for flights within New Zealand in the next two months or beyond will be offered refunds or alternatives on another airline after parent company Virgin Blue announced it will stop flying New Zealand domestic routes...
Virgin Blue has lost millions of dollars since it entered the New Zealand domestic market in 2007 and the losses had to stop, said Virgin Blue Australia's new chief executive John Borghetti.
"Unfortunately we had to pull out of domestic New Zealand simply because...we continuously lost money and there is no prospect of that returning a profit.
"To continue to lose ten of millions of dollars over the next three years or so is just not an option for us," Mr Borghetti said.
Progressively from September 15 to October 17, Pacific Blue jets will cease flying domestically in New Zealand. Forward ticket holders will be offered a refund or alternative flight options - primarily on Air New Zealand.
"We have confirmed that we're able to re-accommodate their customers and understand Pacific Blue will soon contact passengers to discuss their options," said Air New Zealand Group general manager for Australasia, Bruce Parton.
"Passengers will be able to be re-booked on to Air New Zealand services as close to their currently booked departure time as possible."
Pacific Blue flights between Auckland and Dunedin, and Auckland-Queenstown will cease on September 15. Flights between Auckland, Wellington and Christchurch will cease on October 17.
The two Boeing 737s will be put on the busy trans-Tasman route instead.
It's part of an realignment of the the airline group and its three-brand strategy and their respective fleets "...to use the right aircraft with the right cabins for the right markets", Mr Borghetti said.
The review will see V Australia drop its Fiji service on its long range Boeing 777-700ER to be replaced by a Pacific Blue 737.
That leaves V Australia and its four 777s (a fifth arrives in December) to concentrate on its long-haul international destinations from Australia to the US (Los Angeles), South Africa (Johannesburg) and east-Coast Australia to Thailand (Phuket); flights from Perth to Phuket will be operated on Pacific Blue Planes.
Pacific Blue is now being repositioned as Virgin Blue's trans-Tasman and short-to-medium-haul international airline to the Pacific Islands and Asia Destinations include Bali, Papua New Guinea, Vanuatu, Solomons, Tonga, Fiji and Phuket (from Perth), using its 11 Boeing 737s.
The review does not affect Virgin's fourth brand - Polynesian Blue - the joint venture with the Samoan Government, and its flights between Australia and Samoa on its one 737.
Frequencies of Pacific Blue services are set to increase: to Denpasar daily from August 18, three flights a week Perth-Phuket from August 19; Brisbane -Dunedin to four a week from September 17 and Melbourne-Christchurch daily from October 31.
On V Australia, from October 19 Sydney-LA switches to a morning departure to enable same-day flight connections on the US east Coast and Fiji flights will become Pacific Blue services.
From December, Sydney-LA becomes a daily service and and Melbourne to Johannesburg, LA and Phuket each get an additional weekly flight.
When asked whether he was now satisfied he had the right aircraft servicing the right destinations under the right brands, Mr Borghetti said: "Not quite".
He said he will be making a further announcements about the Virgin Blue operations in the coming months.
The pressure has been mounting on Virgin Blue.
It has been in an awkward position since Tiger Airways entered the fray offering air fares often lower than taxi fares.
Meanwhile, Qantas has been powering forward with its dual-brand strategy of no-frills Jetstar at the leisure end of the market (domestic and a rapidly expanding Asian network) and Qantas with its full-service domestic and international routes, maintaining the lion's share of corporate bookings.
Mr Borghetti, who left a senior position at Qantas to head Virgin Blue, is eyeing an increase of its business bookings from 10 per cent to 20 per cent over the next couple of years.
Source: www.theage.com.au