News: QAN Air New Zealand to fly 70% of pre-COVID capacity to Australia as travel bubble opens

SYDNEY, April 6 (Reuters) - Air New Zealand Ltd (AIR) said on Tuesday it would begin flying at 70% of its pre-pandemic flight capacity to Australia once a two-way quarantine-free travel bubble opens on April 19, in a move that is expected to reduce its cash burn.

Before the pandemic, Australia was New Zealand's largest tourism market and demand for travel between the two countries represented around 20% of Air New Zealand's revenue, the carrier said in a statement.

In a boost to the New Zealand carrier and rival Qantas Airways Ltd (QAN) , Virgin Australia said on Tuesday it had suspended the sale of most New Zealand services until Oct. 31.

Air New Zealand shares were trading 6.7% higher at 0455 GMT, while Qantas shares were 2.8% higher.

Air New Zealand had previously guided the market to expect cash burn of NZ$45 million ($31.73 million) to NZ$55 million a month through June 30 at a time when most other international services are suspended.

The airline said the start of quarantine-free travel between New Zealand and Australia was expected to reduce cash burn, though it was not yet in a position to provide updated information.

"As such, the airline's cash burn guidance has been suspended at this time," Air New Zealand said. ($1 = 1.4184 New Zealand dollars)