Air New Zealand has announced plans to launch a new seasonal route between Christchurch and Perth in co-operation with its trans-Tasman alliance partner Virgin Australia. The new direct flight will reduce flying time between the two cities by approximately three hours and will enable many passengers to avoid transfer services. The new link will operate between December 3, 2013 and April 26, 2014 and will be flown twice weekly using a Boeing 767-300ER.

This will be the first non-stop flight between Christchurch and the West Australian capital of Perth in more than 20 years and is currently one of the largest trans-Tasman markets to not be linked directly. The establishment of the route has been made possible by the trans-Tasman alliance between Air New Zealand and Virgin Australia, according to the partners. It will be operated under the Air New Zealand brand but Virgin Australia will codeshare on the service.

Speaking at the formal announcement of the new link at the recent official opening of Christchurch International Airport new terminal facilities, Christopher Luxon, Chief Executive Officer, Air New Zealand, highlighted the reasoning behind the expansion. “This is a great time to be linking these two destinations. The West Australian economy continues to grow at a faster rate than the rest of Australia and rebuilding activity is poised to stimulate travel demand within Christchurch and Canterbury. Christchurch is also a convenient hub for the whole South Island - particularly now the airport company is providing world class terminal facilities,” he said.

For Virgin Australia, now was the right time to commit to this expansion. The airline has been working together with New Zealand’s national carrier for around two years, making use of business and operational synergies to offer a varied and sustainable schedule across the Tasman. “We have been very pleased with the recovery we have seen on Christchurch routes in recent times and we expect traffic to continue to increase as a result of the new airport facilities. Linking Christchurch with Perth, which has long had the highest growth rate of all Australian capital city airports, will provide an attractive service for business and leisure travellers alike,” said Judith Crompton, Chief Commercial Officer, Virgin Australia.

The confirmation of the seasonal service follows around a year of discussions between the airlines and airports involved. According to Brad Geatches, Chief Executive Officer, Perth Airport increasing number of New Zealanders coming to Western Australia for work and leisure saw overall traffic between Perth and New Zealand increase by 20 per cent in 2012, partly supported by Air New Zealand increasing capacity between Perth and Auckland from September 2012 following the introduction of a 777-200 on the route.

“Christchurch is a fantastic destination and is now within easy reach for more Western Australians. It is the gateway to the south island of New Zealand and adds to the number of leisure destinations from Perth. We have been working collaboratively with Air New Zealand, Virgin Australia and Christchurch Airport for more than a year to establish this new service, and we are delighted that Western Australians and South Islanders will have this exciting direct travel opportunity,” he said.

The new service will introduce more than 19,000 additional seats into the trans-Tasman market over its 21 weeks of operation and its announcement represents a massive fillip for Christchurch International Airport as its new terminal is officially opened. The milestone event took place on April 18, 2013 with the $237 million building being opened by New Zealand Prime Minister Rt Hon John Key.

Christchurch Airport is New Zealand's second largest airport and welcomes around six million passengers a year, with a further five million people visiting the airport to greet and wish farewell those passengers. The new terminal now provides the facilities to support the growing demand for air travel, a subject, Jim Boult, Chief Executive Officer, Christchurch International Airport, highlighted at the opening ceremony. "Our old terminal opened in 1960 and was built to handle around 200,000 passengers. These days we handle that number of passengers every 13 days," he said.

In relation to the new route to Perth, Boult said more than 25,000 people travel between Christchurch and Perth every year and others have said they would make the trip if there were a direct flight. “This new service is the result of collaborative planning by two airlines and two airports - Air New Zealand, Virgin Australia, Christchurch and Perth airports. All four of us have long recognised the wisdom of offering these flights and have now found timing to suit everyone. Travellers can save more than three hours flying direct when compared to stopping over somewhere else, so that's very attractive to both business and leisure travellers,” he said.

Alongside the passenger demand the flights are likely to boost the airfreight between the two areas. According to Statistics New Zealand, last year, the total trading value of airfreight between Christchurch and Perth was NZD$475 million, or in volume terms, 300 tonnes.

In the table below we highlight the O&D demand between Christchurch and Perth over the past five years. The arrival of a direct air service will certainly stimulate this market and could lead to the seasonal service increasing in frequency during future schedule periods or becoming a year-round offering. The analysis shows that in 2012, an estimated 30,000 bi-directional O&D passengers travelled on air services between the two cities. Air New Zealand held a 50.6 per cent share of this traffic last year ahead of Qantas with 24.2 per cent, alliance partner Virgin Australia with 12.0 per cent and low—cost carrier JetStar Airways with 8.0 per cent. The majority of passengers between the two cities currently connect via Auckland (44.5 per cent) and Sydney (33.5 per cent).