The jet power game

Press, 29 August 1977, Page 16

The jet power game

Reports last week of the restrictions imposed by the Australian Government on Air New Zealand, and by the New Zealand Government—indirectly—on the Dutch airline, KLM, clearly illustrate the determination of countries to protect the interests of their international airlines.

The move to stop Air New Zealand from picking up passengers in Australia on its flights between Auckland and Hong Kong was obviously designed in Canberra to safeguard Qantas against increasing competition on its services to the colony. Likewise, the decision of the New Zealand Government to ban excursion fares to Amsterdam is aimed at protecting Air New Zealand until The Hague instructs KLM to adhere to an agreement covering the route which excursion travellers between Europe and New Zealand must take.

In the first instance New Zealand has no grounds for argument: Qantas stopped flying “through” Auckland in 1974 when it withdrew its service to Mexico The airline no longer needs reciprocal rights to pick up passengers in this country. However, the Dutch situation is an entirely different story. Late in 1975 the British and New Zealand Governments entered into an agreement designed to ensure that their respective airlines would carry the bulk of the excursion market between both countries. This effectively stopped excursion-fare travellers from crossing the Tasman to connect with European airlines operating from Sydney Passengers destined for the United Kingdom or Europe had to fly with either Air New Zealand or British Airways, and then only via Singapore or Hong Kong. Nor were they permitted to terminate

the flight before reaching the United Kingdom, even if the aircraft was making scheduled stops at European cities that might have been the ultimate destination of some of those on board. If, for instance, they were destined for Rome, and the aircraft landed there, they had no option but to continue to London and then make their own way back to Italy

Britain and New Zealand responded to their critics by stating, quite rightly, that the reduced excursion fare was intended to increase travel between the two countries. But they later granted concessions to European airlines whose Governments applied to share in the excursion rights.

The parties agreed that the fare (at present $lllB return compared with the standard economy fare of S 1900) would be a common one and that travellers would still fly between Auckland and Singapore or Hong Kong with Air New Zealand, British Airways, or Singapore Airlines Passengers could, however. at least begin or terminate their flights in the European country of their choice The Netherlands signed the agreement which entitled KLM to carry excursion nassengers between Amsterdam and Singapore. In recent months, though, the airline began carrying those destined for New Zealand as far as it could—to Sydney

Air New Zealand was justifiably upset at losing the chance of a much larger share of the total fares. To protect its airline the Government was forced to act and, from Thursday, the sale of excursion fares between New Zealand and Amsterdam will be banned until The Hague agrees to instruct KLM to toe the line.