Less for airline shares tipped

Press, 27 January 1988, Page 3

Less for airline shares tipped

By

PETER O’HARA

NZPA correspondent London Competition on domestic air routes probably meant Air New Zealand shares would be reduced in value when they went on the market this year, said the Minister of Finance, Mr Douglas, yesterday. But the Government did not think that was important “compared with the benefits of getting costs down or improving services for air travellers.”

Mr Douglas told the London Chamber of Commerce: “We have committed ourselves to removing any statutory restrictions on competition before State businesses are pri-

vatised. “For example, we have allowed a private airline (Ansett) to compete directly with the Govern-ment-owned Air New Zealand on domestic routes.

“That probably reduces the value of the Air New Zealand shares we want to sell later this year.” Mr Douglas said the effect of the competition had been rapid and very visible. “Run-down air terminals were renovated faster and at lower cost than anyone thought possible. “There are now lowerpriced fares at one end of the scale and enhanced customer services at the other.”