Air New Zealand's chief executive Nikhil Ravishankar has called on New Zealand's major airports to stop offering ongoing financial incentives to Jetstar Airways at Melbourne and Auckland International airports. Ravishankar argues that such subsidies unfairly disadvantage the national carrier by enabling Jetstar, a Qantas subsidiary, to undercut prices on profitable trunk routes while neglecting secondary routes, thus undermining Air New Zealand's ability to maintain regional connectivity.
In an interview with BusinessDesk, Ravishankar emphasized that temporary discounts are acceptable, but persistent subsidies distort competition, especially when they favor profitable routes over unprofitable yet essential services. The Auckland and New Zealand Airports Association dismissed these claims, citing Air New Zealand's dominant 86% domestic market share and defending incentives as necessary for maintaining competition and fare reductions.
The dispute highlights ongoing tensions in New Zealand's aviation sector, with authorities balancing competition, regional accessibility, and market fairness. Both sides maintain their position on the importance of subsidies, reflecting broader debates over airline subsidies and infrastructure investment in the country.
