Pac Blue launches market assault with new seats

Pacific Blue wants to bump up its 11 per cent share of the New Zealand domestic market by launching "premium economy" seats.

Pacific Blue chief executive Mark Pitt said in the next 18 months the budget airline wanted to increase its share against competitors Air New Zealand and Jetstar, which launched into the domestic sphere earlier this year.

All three airlines were committed to the New Zealand market and unlikely to exit, he said.

Pitt said as well as growing its domestic share three or four percentage points to about 14-15 per cent of the market in the next 18 months, the airline wanted to increase its three other geographic operations by at least that 3 to 4 percentage point difference.

Pacific Blue – with an average age on its 11 Boeing 737-800 aircraft of 5.5 years – also plans to increase flights across to Australia.

On the trans-Tasman the airline has about 17-18 per cent market share, and also operates flights to Pacific islands, to Bali and Thailand in terms of its New Zealand operations.

Total operations bring in around $450 million.

For all its operations, run by about 700 staff including 350 in Christchurch, the airline wanted to introduce a new premium seat across the first few three rows in a plane, Pitt said.

"The New Zealand public, they do want low fares, but they also want quality – that's exactly the place in the market that Pacific Blue is," Pitt said.

"We'll be putting premium economy seats in the aircraft. That will happen towards the end of the first quarter of next year."

Economy seats on Pacific Blue's domestic flights could cost anywhere from $29 to more than $200, but the company – 100 per cent owned by Virgin Blue in Australia – was still determining pricing for the premium economy seats both for New Zealand flights and international routes.

Pitt started in the job about 3 1/2 months ago, having worked with Air New Zealand, most recently as chief executive of subsidiary Mt Cook Airline from 2007 to March 2009.

He first crossed paths with Air NZ chief executive Rob Fyfe in the 1980s in the airforce. "The airforce sets you up with a strong leadership background ... I think we're learning more and more that leadership's about people and getting the best from people – taking the obstacles from their way."

While he did not want to be specific about Pacific Blue's expansion plans in terms of new destinations or added capacity, new flights were on the cards in the next 12 months, Pitt said.

"We're looking to increase our footprint in all markets ... we're talking to a number of airports (on both sides of the Tasman)," he said.

"Certainly there'll be some increased capacity on the Tasman. There will be some announcements soon."

Pacific Blue would continue to examine what it would "do for travel in the future". Following a 7 per cent decline over the past 12 months in passenger numbers, the airline had seen a stabilisation.

- © Fairfax NZ News