Doubt hovers over Hong Kong link

Press, 2 April 1985, Page 36

Doubt hovers over Hong Kong link

By

LES BLOXHAM,

travel editor New Zealand's direct air link with Hong Kong, which was unexpectedly severed when Air Niugini withdrew its twice-weekly service in January, might never be restored. The fate of the route will probably be decided in the next week or two after nearly two months of tough negotiating between Air New Zealand and the Hong Kong based carrier, Cathay Pacific. The three airlines agreed in 1982 to a tripartite arrangement under which each would fly the route turn about for a year. Air Niugini’s term was to have ended last week, but in a surprise move the airline stopped its flights in January. The airline was trying to maintain the long-haul service from Auckland to Hong Kong, via Port Moresby, with

aged uneconomic Boeing 707 s — the biggest aircraft in its comparatively small fleet. Since Air Niugini’s withdrawal, New Zealanders bound for Hong. Kong have been forced to divert through either Sydney or Singapore — time-consum-ing diversions which usually require an extra night’s accommodation on route. The direct link got New Zealanders to Hong Kong within 12 hours of leaving Auckland. Freight now must also be transhipped on to connecting flights out of Australia or Singapore. Air New Zealand pioneered the route with DCBs in 1966, later switching to DClOs and, more recently, to Boeing 7475. Cathay Pacific also used 747 s during its 12 months on the route in 1983. As Air Niugini’s Boeing 707 s carry fewer passengers than the much bigger 747 s

of the other two airlines, it was granted permission to increase frequency to two flights a week. The airline, however, could not cater for the lucrative business-class traffic and was also severely restricted by the limits of its first-class cabin. As a result, much of this highrevenue traffic was lost to Cathay Pacific and Qantas, both of which can provide daily flights to Hong Kong from Australia. Air Niugini’s opting out of the agreement caught Air New Zealand with its under-carriage down: it had no spare 747 available to fill the gap. Air New Zealand had originally planned to fly the route again this month, but this was put back first to May, and then to June. The delay has been caused by the failure of the airlines to hammer out a new agreement. On Friday, an Air

New Zealand spokesman confirmed that negotiations were continuing, but he could not say whether the old tripartite agreement might be resurrected, or whether a new bipartite arrangement involving only Air New Zealand and Cathay Pacific would emerge in its place. The issue is complicated by the fact that Hong Kong’s air rights are currently controlled by the British Government which already has one airline — British Airways — flying to New Zealand.

Landing rights at Hong Kong were originally granted to Air New Zealand as the quid pro quo for British Airways services to Auckland. Since then, however, the situation has changed in that Air New Zealand is now flying direct to London, via Los Angeles. Air New Zealand’s re-entry to Hong Kong under any new agreement would almost certainly allow Cathay Pacific reciprocal landing rights at Auckland. Cathay Pacific could then be expected to want to sell a broad range of fares not only from New Zealand to Hong Kong, but also beyond — to Europe and London.

This would mean more competition for Air New Zealand.

Hong Kong once was a popular stopover city for New Zealanders flying to London on cheap fares, but this concession was withdrawn shortly before Air New Zealand began its services to London four years ago. Industry sources predict that Cathay Pacific is unlikely to want to return to the New Zealand route if it is denied access to cheap fares beyond Hong Kong. If agreement cannot be reached, the days of the direct flight to the colony will remain but a memory.