LA-bound travelers could face price hike with Qantas exit

New Zealand travellers flying direct to the Los Angeles can expect average fare prices to go up as Air New Zealand remains the only airline flying the route. 

Qantas has just exited the Auckland-LA route, after announcing it would stop the service in February following a slump in profits. 

At the time, Air NZ said it planned to increase capacity on the route, and did not intend on increasing prices. 

An Air NZ spokesperson says compared with the period before Qantas announced its withdrawal from the route, individual ticket prices have gone down 14% for economy, and 16 percent for premium economy and business premier. 

The airline is also currently running 13 direct flights per week, up from 12 before the announcement. 

It says that will increase to 16 in peak periods such as school holidays. 

However, House of Travel's retail director Brent Thomas says individual ticket prices are only part of the story.

He says while the airline may have technically reduced prices for individual fares, it may also have reduced the number of seats available at that price. 

"Because you lose that competition, there will be fewer seats available at that price in the lower class, so people are forced to upgrade a class, driving a higher price to the average customer," Mr Thomas told NBR ONLINE. 

He says it is logical to assume the average price will go up over time. 

Eagle Aviation Consulting's director David Lanham says although Air New Zealand is now the only carrier flying directly to LA, it still faces stiff competition from airlines who fly non-directly. 

"A Qantas fare to LA via Sydney is $200 lower than a direct Air NZ flight from Auckland. And an Air Tahiti Nui flight via Tahiti is $50 cheaper," he says. 

Mr Lanham says while there is still some competition, Air NZ will be happy that Qantas has exited the route. 

He says for the period June to October this year, Air NZ has increased its capacity on the Auckland-LA route 6% compared with the same period in 2011. 

"That is obviously in response to the Qantas withdrawal. Qantas had about 20% of the capacity between Auckland and America, so obviously that's all gone," he says.