In a speech to Canberra’s National Press Club on Wednesday, September 18, 2019, Qantas CEO Alan Joyce lashed Australia’s airport operators. He argued that consumers are being charged much more than they should be by Australian airports and that it is holding back the productivity of the country.
For Qantas, airport charges are the highest expenses after fuel costs, aircraft costs and wages. For regional and LCC operations, they can be the second highest or highest costs.
Alan Joyce quoted an investment banker speaking about one of Australia’s big four airports:
“The airport has an unregulated revenue stream in a monopoly environment.”
And Alan Joyce saved much of his ire for Canberra Airport, a place one aviation commentator recently described to Oz Traveller as a “cartel run by billionaires.”
In January 2019, A Jetstar A320 flying from Hobart to Sydney diverted to Canberra after strong winds were causing big delays at Sydney. The plane didn’t have enough fuel to circle endlessly while the backlog at Sydney cleared.
Yesterday in Canberra, Alan Joyce said of the incident:
“An aircraft that was diverted to Canberra because of weather in Sydney was held to ransom until we paid a $18,000 fee, twenty times what it costs to divert an aircraft to Sydney. We had to pay it on a credit card and we weren’t allowed to move the aircraft until it was paid. Now at the time, I said of that event, you’d expect that to happen with Somali pirates, not with an airport… You don’t expect it to happen here in Australia.”
Passengers and crew were kept on the aircraft for some ninety minutes until the bill was paid and ground crew were organised.
Alan Joyce also criticised the high everyday airport charges at Canberra, saying it was holding back the growth of services at the airport, notably by Jetstar who cannot make flying to Canberra work with the current airport charges.
Canberra Airport has a passenger tax of $25. Alan Joyce notes that the bulk of Jetstar fares are less than $100. He says that even for Qantas services, passenger taxes at Canberra are pushing up fares to the city already well known for very high fares.
“Fees and charges from monopoly airports are excessive and they are damaging the economy, and airports continue to reap super profits because there’s no real threat of intervention to moderate their behaviour.”
Alan Joyce argues that more moderate taxes at airports such as Canberra will boost flights to the city and stimulate traffic. That’s a good result for the airline, the airport, and the local economy.