New budget domestic airline coming?

[MotherBear]

New cut-price domestic airline on the way?
12:30PM Thursday May 03, 2007

American and Japanese investors are looking at launching a new domestic airline in New Zealand.

Kiwijet is the brainchild of US aviation specialist Patrick Weil. He says the country is ready for a simplified, cost-effective form of domestic air travel.

The fledgling airline would initially fly two Boeing 737s between Auckland, Christchurch, Dunedin and Invercargill.

All fares would cost a flat $150.

Mr Weil says Kiwijet is considering bidding for acquisition of an existing domestic airline and hopes to be operating by the end of the year.

- NEWSTALK ZB

From here

[MotherBear]

New low-cost airline chances slim, say analysts
5:00AM Saturday May 05, 2007
By Liam Dann

Airline industry analysts are sceptical about the chances of a new low-cost airline starting up here after a United States-based aviation investor this week announced plans to set up a rival domestic airline called KiwiJet.

Air New Zealand investors were unfazed yesterday and the company's shares rose to a fresh high of $2.85 on news it was also considering launching a low-cost carrier.

Staff were told in a memo leaked to the media that a low-cost carrier was one of three or four growth initiatives being considered by the company as part of a strategic review.

Forsyth Barr aviation analyst Rob Mercer said he believed Air NZ could successfully run a low-cost brand alongside existing services and grow the market.

The key was to ensure it did not cannibalise the lucrative business market where passengers paid for full-price tickets at peak travel times.

Any secondary service would have to be run at non-peak times and target the leisure market.

Mercer saw little chance of success for a new entrant such as KiwiJet taking Air NZ on head-to-head on its main routes.

More here .