Airport group blasts airline profiteering

Domestic airfares jumped in the last three months of 2019, adding an average of $14 to the price, an airport industry group says.

The New Zealand Airports Association, which represents airports and related businesses, has blamed the fare increase on airlines ‘‘taking advantage of recent developments’’, such as Jetstar’s withdrawal from regional routes, to boost prices.

The association’s chief executive, Kevin Ward, said the cost of domestic air travel had jumped 8.5 per cent in the last three months compared with a year ago, according to Stats NZ figures.

This was bad for airport business and for consumers, he said. ‘‘Increased fares translate directly to fewer people able to travel.’’

Ward said the fare hike would cost air passengers an extra $165 million for a full year.

‘‘Domestic airfare increases on this scale are many times greater than the rate of inflation and have a choking effect on regions at a time the Government is investing in provincial economies.’’

He said the fare hike coincided with Jetstar’s withdrawals and the agreement between Air New Zealand and Qantas to co-operate in each other’s domestic markets.

However, the body representing airlines says the hikes reflect increased costs and softening demand. Justin Tighe-Umbers, executive director of the Board of Airline Representatives of New Zealand, said airlines reducing capacity on routes were responding to a slowdown in local passengers in the second half of last year. At the same time, airlines faced more in red tape and jet fuel costs.

He felt the airports were alleging profiteering for other reasons.

‘‘I think that’s just a classic bit of deflection away from the real issue, which is the Government’s looking to or has proposed to remove the ability for airports to charge as they see fit. No other monopoly infrastructure has that right to charge as they like, protected by legislation.’’