ANZ Statement on Virgin Blue

15th May 2003

Statement made by Ralph Norris, Managing Director and CEO,
Air New Zealand Limited
Virgin Blue has at last come clean on its real intentions in relation to Freedom Air, and that is the total elimination of a potential competitor.

Our latest undertakings give Virgin Blue a clear run at setting up trans Tasman and domestic New Zealand services without any competition in the Value Based Airline segment on some routes, but still that is not enough. They are demanding a permanent monopoly.

It is intent on knocking Freedom Air out of the skies, and Virgin Blue is nothing more than The Big Bad Wolf dressed up as Little Red Riding Hood`s grandmother.

If it succeeded, more than 200 New Zealand jobs could be vulnerable, many located in provincial New Zealand centres such as Hamilton.

Many local businesses that supply services and goods to Freedom will lose that business.


To date, more than half a million travellers per annum have taken advantage of Freedom`s low cost fares. The airline provides provincial New Zealand with direct access to Australian centres and a source of Australian tourists into the provinces.

It is questionable whether Virgin Blue would service these centres once Freedom Air was out of the way. It would be more likely to concentrate on the main cities in New Zealand and Australia - the key routes on which it is being offered a free ride.

This cherry picking of the main routes will present a challenge to Freedom, and Virgin Blue`s latest posturing is simply designed to eliminate a competitor.

Virgin Blue positions itself as the people`s champion. Reality is, Virgin Blue is a highly profitable company owned by two large multi national corporations, each larger than Air New Zealand.

Freedom Air has agreed to withdraw from the main centre routes, and restrict Freedom Air`s growth for three years. That should be enough.

It would appear that nothing will ever appease Virgin Blue`s never ending demands.


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