AirAsia

Commerce Commission warns AirAsia for likely misleading customers

SUPPLIED

AirAsia launched an Auckland to Gold Coast service in March, but the price of the service was likely misleading.

Low-cost airline AirAsia has been warned for likely misleading New Zealand customers over its prices.

The Commerce Commission said on Monday it had warned the Malaysian airline over opt out pricing and for a processing fee which was not properly disclosed.

AirAsia has agreed to end the preselection of checked baggage, as well as change how it identifies the processing fee, when selling tickets to New Zealand customers online.

This meant checked baggage would now be sold on an opt in basis, and there was an alternative payment method now available to avoid the processing fee.

The issue related to AirAsia's introduction of flights between Auckland and the Gold Coast in March.

AirAsia advertised a price which did not include a pre-selected baggage allowance, and charged a payment processing fee which was unavoidable.

The commission said it believed these two points were likely to have misled consumers over the price of the flights.

Commerce Commission chair Mark Berry said AirAsia had co-operated fully with the investigation, and made the necessary changes in July.

Seven companies had ended opt out pricing since the watchdog began investigating it last year, he said.

"We have made our position very clear on this issue and expect businesses to stick to an opt in sales approach."

Other companies to have stopped opt out pricing included Air New Zealand, House of Travel, Dash Tickets, Ticket Direct and Naked Bus.

Jetstar resisted initially, but in March this year reached an out-of-court settlement with the commission which removed the preselection of opt out services.

The commission said it was not investigating anybody else regarding this issue.