Cathay Pacific is to lengthen its joint venture with Air New Zealand until the end of October 2024. According to a report in Business Traveller, the agreement will offer up to 25 return services a week between the two countries and help stimulate trade and tourism.

FLE_7ER_C061Y15_E0
Cathay Pacific has just extended its joint venture with Air New Zealand. Photo: Cathay Pacific

The two airlines have been cooperating since 2013 and Air New Zealand says the agreement is an important part of its overarching Pacific rim strategy.

In a statement, Air New Zealand said;

"Since forming an alliance in 2013, we've together increased frequency and capacity between New Zealand and Hong Kong, providing travelers with up to four services a day.

Our joint venture alliance with Air New Zealand has allowed us to offer more flights and more seats between Hong Kong and New Zealand, while also enabling us to introduce new routes such as our non-stop seasonal service to Christchurch which will step up from three to four flights per week this year. With this partnership extended for a further five years, we can continue to offer more choice and convenience to our customers when they fly with us."

Back in 2013, when the joint venture was first initiated, Air New Zealand was offering a terrific fifth freedom flight between Hong Kong and London. The agreement saw Air New Zealand withdraw from this route. That loss was partially offset by Cathay Pacific offering seasonal services between Christchurch and Hong Kong.

Air New Zealand also places its code on several Cathay Pacific flights beyond Hong Kong, making it easier for diehard Air New Zealand loyalists to earn points and status on flights outside New Zealand.

A long history of codeshares and JV agreements

Like most airlines, Air New Zealand has entered into a series of alliances and codeshare ventures with other airlines in order to extend its reach and facilitate connectivity for its passengers.

Following the breakup of its agreement with Virgin Australia, the Kiwi airline hooked up quick smart with Qantas (again) to codeshare on flights across the Tasman. Air New Zealand also co-operates with Singapore Airlines on flights between New Zealand and Singapore. It also enjoys close links with United Airlines.

air-new-zealand-ceo
Air New Zealand co-operates with several airlines in formal agreements. Photo: Umedha Shanka Indranath Hettigoda via Flickr.

Why these agreements make sense

Joint ventures such as these are increasingly important to Air New Zealand. Being an end of the line carrier, its home base of Auckland is at best a minor transit hub and the airline enjoys little through traffic. It is important to generate point to point travel and agreements like this one with Cathay Pacific help boost traffic onto Air New Zealand flights departing from big busy hubs like Hong Kong and Singapore. Of course, most of the inbound travelers need to be taken back again at some point.

The benefit for the partner airlines is access to Air New Zealand’s extensive domestic network and the ability to sell through tickets to ports like Dunedin and Invercargill. These passengers can travel through on SQ or CX ticket stock and earn points and status credits on their home airlines.

cathay-pacific-air-new-zealand
It's important to fill those seats. Photo: planegeezer via Flickr.

As Air New Zealand looks to rein in its costs and boost revenue in the face of a recent sharp decline in net profits, passengers can expect to see the airline enter into new agreements and build on existing agreements in an effort to stimulate passenger numbers and bolster growth.