Partners to rivals: Air NZ, Virgin Australia end 7-Year alliance

Air NZ said it would end its 7-year alliance with Virgin Australia, meaning the airlines will now compete head-to-head for passengers in the hotly competitive route between the two countries. Under the alliance, the pair had coordinated their route network, flight schedules and pricing, but when the deal expires in October they will be free to pursue different strategies for the Australia-New Zealand sector, where more than 10m seats are offered annually by airlines flying the route. Air NZ shares rose 4% and Virgin Australia shares fell by as much on the news. Virgin Australia CE John Borghetti said that following the end of the alliance, his airline might deploy its low-cost arm Tigerair Australia on flights between Australia and New Zealand for the first time. <br/>