Air New Zealand cuts domestic fares by up to 23 pct

Published: 15 Oct 2009 19:42:23 PST

WELLINGTON, Oct 16 - Air New Zealand would cut its domestic fares by up to 23 percent and simplify the fare structure in a bid to stimulate domestic travel, the airline said on Friday.

Shares in Air New Zealand, 77 percent owned by the New Zealand government, last traded up 0.8 percent at NZ$1.33. The stock has gained around 46 percent so far this year, compared with an 18 percent rise in the benchmark top 50 <.NZ50> index.

In August Air New Zealand reported a 90 percent fall in profit and said there were signs demand for air travel is stabilising, although the environment remains turbulent.

Air New Zealand dominates domestic air routes, competing with Australian airlines Virgin Blue <VBA.AX> and Qantas Airways' <QAN.AX> low cost carrier JetStar.