Two people have been taken to Lakes District Hospital with serious injuries after the crash on Malaghans Rd near Arthurs Point.
Sergeant Chris Brooks, of Queenstown, told the Otago Daily Times at the scene that a rental car and ute crashed on a blind corner about 6am.
"We believe the rental car was on the wrong side of the double yellow lines and the cars met on the bend, Sgt Brooks said.
"The speed of the collision ignited the car straight away."
Only two people were involved in the crash on Malaghans Rd, between the Skippers Rd/Littles Rd intersection and North Ridge Rd.
Sgt Brooks confirmed the driver of the rental vehicle was inside the car when it caught fire, but was able to get out.
Emergency services, including fire crew from Arrowtown and Queenstown, attended the incident.
In a statement, St John spokesman Gerard Campbell said paramedics got a call shortly before 6am and two people were taken to Lakes District Hospital, both in a serious condition.
The road reopened about 8.30am.
