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Back to main menuAir New Zealand and Air China Strategic Alliance: Independent Economic and Competition Analysis
Published: 2026
Authors: Tadhg Ryan-Charleton, Stuart Donovan, Leon Stirk-Wang
Following the introduction of the Civil Aviation Act 2023, the Ministry of Transport developed an assessment framework to improve the transparency and robustness of the process for authorising airline alliances. The Ministry then engaged Motu researchers Tadhg Ryan-Charleton, Stuart Donovan, and Leon Stirk-Wang to lead independent economic and competition analysis of the first two applications submitted for (re)authorisation.
The attached analysis focuses on the strategic alliance between Air New Zealand and Air China, which governs the airline’s operations on the Auckland-Shanghai and Auckland-Beijing routes. The current authorisation was due to expire in March 2026, and the partners had applied for a further five-year authorisation.
We followed a five-step analytical approach that involved defining and analysing relevant markets (including market shares, fares, capacity, and feeder traffic), assessing counterfactual scenarios submitted by the airlines, examining competition effects, and considering the wider public value of the alliance.
Our analysis suggested the alliance contributes to Air New Zealand’s position as a viable competitor in the relevant market for the Auckland-Shanghai route but is not determinative of market structure. In the Auckland-Beijing market, the alliance sustains the only nonstop service, which expanded the market significantly following its introduction. We suggested that the net impact of the alliance was more likely than not to be beneficial for consumers and New Zealand if authorised.
Read our report here: Motu’s Air New Zealand and Air China Strategic Alliance Analysis (some commercially sensitive information redacted)
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Ministry of Transport
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