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Examples
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Qantas is Virgin Blue's biggest competitor on the trans-Tasman route between Australia and New Zealand and had objected to fast regulatory approval of the Etihad deal.
Virgin Blue Pact Approved in Blow to Qantas Ross Kelly 2010
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Air New Zealand Chief Executive Officer Rob Fyfe said the decision favors customers and will help the trans-Tasman market continue to grow.
Virgin Blue Pact Approved in Blow to Qantas Ross Kelly 2010
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The ACCC last year approved the V Australia/Delta tie-u p. "Unlike that case, this matter involves an alliance between the first and third major competitors in the trans-Tasman market and substantially less significant connectivity benefits for consumers," the ACCC said Friday.
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Competition on the trans-Tasman route is fierce, with "no-one making a quid," Australian Tourism Minister Martin Ferguson told Dow Jones Newswires in September.
Virgin Blue Pact Approved in Blow to Qantas Ross Kelly 2010
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"The ACCC considers that the alliance is likely to reduce competition in the market for trans-Tasman air passenger services," ACCC Chairman Graeme Samuel said in a statement.
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Virgin Blue dropped 7% after Australia's competition regulator said it will likely block Virgin's planned trans-Tasman tie-up with Air New Zealand.
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Qantas Airways Ltd., meanwhile, was up 2.0% at A$2. 60, with the two rulings removing key competitive threats on the lucrative trans-Tasman and Australia-U.S. routes, where it enjoys leading positions.
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I therefore welcomed the initiative of Stephen Smith in proposing that a trans-Tasman discussion should also occur.
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"The ACCC believes that Virgin Blue is a significant competitor to Air New Zealand and there are a number of trans-Tasman routes where the alliance raises competition concerns," Mr. Samuel said.
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Ferguson declined to weigh in on the issue of the trans-Tasman route between Australia and New Zealand, but noted that competition on that route is fierce, with "no-one making a quid".
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