Air New Zealand (NZ, Auckland International) has announced it will partner Qantas (QF, Sydney Kingsford Smith) on domestic New Zealand/Australian services following the finalization of its divorce from Virgin Australia (VA, Brisbane International) in late October of this year.

In a statement, Air New Zealand said it had signed a codeshare agreement with Qantas wherein Qantas intends to add its code on up to 30 routes on Air New Zealand’s domestic network while Air New Zealand intends to add its code on up to 85 routes on Qantas’s domestic network.

“While the two airlines will continue to compete very strongly across all markets, Air New Zealand and Qantas are known for having a commitment to innovation, customer service excellence, operational performance and safety," Air New Zealand Chief Executive Officer Christopher Luxon said in a statement. "We are confident that our respective customers will enjoy the reciprocal benefits on both sides of the Tasman.”

Tickets for the codeshare services will be available by the end of July 2018, for travel from October 28, 2018, onwards.

As previously reported, in addition to cutting its commercial ties with Virgin Australia, Air New Zealand has also completely divested itself of the Australian carrier's stock.

Commenting on the tie-up, the CEO of the Australian Airports Association, Caroline Wilkie, has called on competition regulators on both sides of the Tasman to thoroughly scrutinize the Qantas/Air New Zealand tie-up to ensure it does not adversely impact the travelling public and Virgin Australia.

She said in a statement that the arrangement could lessen competition in both the New Zealand and Australian domestic markets and also had the potential to constrain the trans-Tasman market and thus impact tourism.

“There are a limited number of airlines operating in both countries, and between them, so it is important there remains a healthy level of competition in the market,” Wilkie said. “This arrangement seems likely to make it harder for Virgin Australia to compete in the Australian market. The ability to distribute each others’ passengers on the other side of the Tasman will improve the market position of Qantas and Air New Zealand and make it harder for Virgin to compete on trans-Tasman routes. It is therefore essential the details of this agreement be publicly examined by the competition authorities to ensure it has no anti-competitive effects."