Optimism the trans-Tasman bubble would quickly normalise travel between Australia and New Zealand has proved unfounded, with few taking the opportunity to go overseas without the need for quarantine.
Travel between the two countries is still only at about 30 percent what it was in 2019, nearly a month after the bubble opened.
"It's a pretty muted start compared to the optimism we had when it was announced about a month ago," Milford Asset Management portfolio manager Mark Riggall told The AM Show on Thursday.
There aren't any price or capacity bottlenecks, Riggall said - putting it down to fear of getting stuck, should there be a COVID-19 outbreak either side of the Tasman.
"There was certainly a lot of capacity put in place. It's not prices putting people off, or availability of flights. Anecdotally we have heard evidence of flights being cancelled. I think it's just a tentative approach."
In the first nine days of the bubble, Stuff reported arrivals were about 17 percent of the pre-pandemic norm, and departures just over 10 percent. Departures have since risen to 12 percent, Riggall said.
"Initial evidence shows that over the last three weeks, departures are slowly increasing. There's obviously some tentativeness, worries about being trapped or stranded."
Riggall said airlines are cyclical businesses which "go through difficult periods", but this one is more difficult than most. On Monday the Australian government, for example, said it didn't expect to open the borders fully until late 2022.
"For us and for Air NZ, you really need that international tourism piece to come back on... That's a long way away," said Riggall.
"Airlines have managed to manage their cost structures through this and operate on a shoestring, effectively, so that could be positive going forward if you see the volumes increase again. I think the point I'm trying to make is that the outlook of volumes is going to be pretty muted for a number of years to come."
From May 17, the UK will allow quarantine-free travel from New Zealand, provided they haven't been in any countries not on its 'green list' in the previous 14 days.