Build the facilities and we will fly there says Pacific Blue

Pacific Blue is offering the prospect of flights to many more destinations in Australia provided governments pick up the cost of border control and security services at airports which do not currently have those services available.

Services between Wellington and Canberra are a hot prospect for the carrier, which says it is evolving from a low cost leisure airline to competing with traditional carriers for the business market.

Pacific Blue's Commercial General Manager, Adrian Hamilton-Manns, told a Wellington business audience that liberalization of travel rules on the Tasman will lower airfares but won't necessarily open up more destinations.  The mater is currently being studied by the Australian and New Zealand governments.

"Of every hundred dollars we collect in fares we pay about $35 to governments to pay for border and aviation security immigration and the like.

"Biometric and security processes will enable everyone to be pre-cleared for entry before they get on the plane.

"Canberra is a great opportunity for us. 

However as a non international airport, Canberra does not have the biosecurity and other border control services at the moment, and Pacific Blue is looking to governments to pay for these to enable the airline to operate.

"Someone has to pay and the costs are prohibitive for us."

"When we were looking at operating internationally from Dunedin, MAF was looking to present us with a bill for a million dollars. We said no, and the airport company said no as well and said the government should pay.

"A burden like that for us is huge, but if it is removed then we can pass the benefits back to the traveler, and we wouldn't be keeping it for ourselves in the form of higher profits."

"So the challenge is about how to remove those changes in the next two to five years."

Charles Finny, the Chief Executive of the Wellington Regional Chamber of Commerce said Wellington businesses did not want to wait five years.

He said the Wellington - Canberra route was suitable for a pilot scheme because there were no existing operators on it and therefore no vested interests.

He said the chamber would be putting pressure on the government to set up a trial.

Mr Hamilton-Manns also held out the prospect of regular flights from New Zealand gateways to Australian destinations such as Adelaide, Prosperine, Port Macquarie, Darwin, Broome, Hobart and Launceston. Pacific Blue would introduce a 100 seat Brazilian manufactured Embaerer 190 aircraft which would make daily services possible.

The aircraft could also be used on domestic routes.

"Melbourne will be the next port for us for Wellington flights."

He called attention to the airfares to Australian cities ex Wellington. "It's a $180 to Brisbane and $175 to Sydney and Pacific Blue operates on both routes, but it's $290 to Melbourne where Pacific Blue does not operate.

"Low fares grow markets. Since we have been operating domestically travel has increased by 4%, so the market grows even if the passenger does not fly with us.


Published on line by the National Business Review on 16 October 2009