Scandinavian Success Creates New Air Services Opportunities

  • Maurice Williamson
Transport

Denmark, Norway, and Sweden are New Zealand's newest air services partners, the Minister of Transport, Hon Maurice Williamson, announced today.

"The recently negotiated air services agreements create additional trade and tourism opportunities between New Zealand and these three countries," the Minister said.

"These agreements provide a sound basis for the development of direct air links between Scandinavia and New Zealand, enhancing service options for travellers from those countries to this part of the world."

The agreements will be an important boost to New Zealand's attractiveness as a tourism destination in these Scandinavian markets.

The three new agreements give the airlines of each country the opportunity to put in place services without restriction as to the routes that may be operated, the capacity of frequency that may be offered, or the choice of code-share partners.

In addition, individual airlines have the freedom to establish their own prices and to vary those prices without needing the approval of authorities in each country.

The pricing freedom means that airlines will have the maximum flexibility to develop and implement innovative and competitive prices, in line with market conditions.

"This is the latest development in a major thrust in air services negotiations as the Government seeks to create new opportunities and expand existing opportunities in Europe," the Minister said.

"I expect to be able to announce in the near future the results of five other air services negotiations being held with European countries.

"Creating new relationships and opportunities is a key part of ensuring that the airline and tourism industries are able to respond quickly to changes in market performance," the Minister said.

The three countries - Denmark, Norway, and Sweden - negotiate as a single bloc with bilateral partners, with each then concluding a separate but essentially identical bilateral agreement with that partner.

This approach, which differs from the traditional bilateral approach to inter-government air services arrangements, results from the 1946 formation of Scandinavian Airlines System (SAS) as a consortium of the national airlines of Denmark, Norway and Sweden.

SAS operates international air services on behalf of the three countries.

SAS is a founding member of the Star Alliance, which Air New Zealand, along with its partner airline Ansett, intends joining in early 1999.

It is expected that in the short to medium term it will be code-sharing opportunities that will be taken advantage of rather than the operation by an airline of its own aircraft over the entire route.

The air services agreements, which are being applied provisionally in anticipation of signature, are the first such agreements between New Zealand and the three Scandinavian countries.