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IATA: Australian hubs need to rethink airport charges

Global aviation body says Aussie airports have too much market power

The International Air Transport Association (IATA) says more needs to be done to curb the market power of Australia’s main airports.


Addressing the Australasian Aviation Press Club, IATA Director General and CEO Alexandre de Juniac said that although there had been some promising developments in local aviation, especially “encouraging” plans for Badgerys Creek airport, Australia needed to strengthen its economic regulation of airports.




“ … we need to take a serious look at airport charges,” Mr de Juniac said.


“Last year the Australian Competition and Consumer Commission raised concerns about the effectiveness of Australia’s price monitoring regulatory regime for airport charges. They were not convinced that it does enough to constrain the market power of Australia’s main airports. We agree with the ACCC’s view.”


A major problem, according to de Juniac, was that airlines and travellers had not seen decreases in airport costs over the last ten years commensurate with the fall in overall fares.


“The difference is that airlines operate in a competitive environment while airports have much more market power. We must find an effective regulatory solution to ensure that Australia is well served with competitive infrastructure,” he remarked.


In Sydney for the 74th IATA Annual General Meeting and World Air Transport Summit, de Juniac praised progress on the Western Sydney Airport, but warned of challenges.


“Looking ahead, the challenge is solid execution,” he said.


“This includes developing a vision on the roles of Badgerys Creek and Kingsford-Smith and the connectivity between the two airports.


“Until Phase one of Badgerys Creek is ready in 2026, there is an urgent need to find ways to use Kingsford-Smith to its full capabilities.”


Globally, the IATA boss flagged infrastructure as “the big issue of the day”.


“A global infrastructure crisis is being complicated by governments considering an acceleration of private sector involvement in airports,” he stated.


Held from 3-5 June and hosted by Qantas, the 74th IATA Annual General Meeting and World Air Transport Summit will see over 1,000 aviation leaders converge on Sydney.


Written by: Mark Harada
Published: 1 June 2018

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