Qantas Bid to Take Singapore Airline's Stake in Air New Zealand Could Lead to Major Shakeup in Asia-Pacific Airline Industry
DALTON TANONAKA, CNN ANCHOR: The Qantas bid to take Singapore Airline's stake in Air New Zealand could lead to a major shakeup in the Asia-Pacific airline industry. Several debt-ridden smaller carriers in the region need capital injections, but there's one big obstacle, national pride. CNN's Kristy Alfredson explains.</s>KRISTY ALFREDSON, CNN CORRESPONDENT (voice-over): Qantas is looking to buy as much as a 49 percent stake in Air New Zealand, including the 25 percent now owned by Singapore Airlines. In the deal being mooted, Singapore Airlines would buy Ansett Airlines from Air New Zealand.</s>PETER HILTON, CREDIT SUISSE FIRST BOSTON: Politically, it may be very difficult for the New Zealand government to be comfortable with what is effectively a takeover by an Australian company, but what with the drawing together of the two economies, maybe it's not as difficult as it might have been a few years ago.</s>ALFREDSON: Countries like having their own carrier, and that limits these kinds of acquisitions. Malaysian Airlines announced on Tuesday a $342 million loss, it's fourth in row. It may want an injection of capital, but that's not likely to occur while only limited control is on offer. It's the same story for Thai Airlines.</s>HILTON: I think with in wider Asia, you still got the strong political overtones of being a national carrier that would inhibit more rationalization. I think it's a bit more limited. I think the alliances will grow stronger, and the various Asian carriers will become greater part of alliances, and maybe 10 years from now, you know, there more material equity stakes.</s>ALFREDSON: Where ownership doesn't change, however, airline alliances may. If the Qantas deal goes ahead, Star Alliance may lose Air New Zealand, and it could also lose Thai Airlines, which says its not getting its fair share of passengers under the referral system. (on camera): The traveling public isn't likely to notice any shakeup in the airline industry, but that could be a different story if one of the carriers decides to cut maintenance costs.</s>HILTON: It is probably looked at more aggressively than you would imagine, because if you do have a crash, then it really puts back any chance of moving into an alliance, and that really would revalue your stock. You have to be careful of it, but I think the airlines actually look at it more carefully than just another cost item. But you know, accidents do happen, because errors have occurred.</s>ALFREDSON (voice-over): Regulators grounded Ansett earlier this year, because of maintenance concerns leaving passengers stranded. Kristy Alfredson, CNN, Hong Kong.