Consumer rights group accuses Air New Zealand of exploiting families during holiday season

A Consumer NZ investigation has found that flying Air New Zealand during the school holidays could be costly for families, with evidence suggesting the national carrier is cashing in on increased demand.

The study tracked prices on 648 trans-Tasman flights over 18 weeks, comparing Air New Zealand and Qantas fares to see how they stacked up over two school holiday periods.

The results showed that Air New Zealand flights were up by an average of 43% over the holidays, while Qantas fares were up just 24%. Air New Zealand’s price increases have been particularly noticeable on some routes; The cost of a family of four trip from Christchurch to Brisbane has risen 167% when booked just two weeks before departure, reaching $9,014, up from $3,378 three weeks earlier.

Brisbane is the most expensive destination, with fares rising sharply during the holiday period, an investigation has found. For example, flights departing on July 10, four days into the school holidays, were $3,916 more expensive than flights three weeks earlier. In the worst case scenario, families flying with Air New Zealand had to pay $4637 more than if they had booked tickets with Qantas on the same day.

The study also found that Qantas offers a more stable price structure with significantly lower increases over the same periods. For families traveling in the first week of the holiday, Air New Zealand flights were on average 34% more expensive than Qantas flights, equating to an extra $1,230 per trip.

Air New Zealand’s use of dynamic pricing, in which ticket prices rise as demand increases, has come under scrutiny.

The airline defended its pricing model. In a statement to chrislynchmedia.com it said demand-based pricing was not unique to Air New Zealand.

“This is standard practice for airlines, hotels and car rental companies. School holidays cause a surge in demand and this approach allows us to manage supply and demand.

“We would like to increase capacity during these busy periods, however, with seven of our aircraft currently out of service due to global engine supply issues, we do not have spare aircraft to add to the schedule. We encourage customers to book early to get the best deals.”

Consumer NZ has criticized the airline’s pricing tactics, awarding Air New Zealand its first “Yes No” award for exploiting New Zealand families during the holiday season.

The organization expressed doubts that the airline is making enough efforts to meet increased demand by increasing the number of flights or is simply capitalizing on its dominant market share.

With Air New Zealand holding 43% of the trans-Tasman market and recent regulatory approval of a codeshare agreement with Virgin Australia, some consumer advocates have raised concerns about the lack of competition on these routes.

Without transparency about how many extra seats are provided during peak times, consumers are left wondering if they are being taken on a ride.

Air New Zealand advised travelers to book as early as possible to get the best deals, but did not reveal how many extra seats it had added on international routes over the holidays, citing commercial sensitivity.