Syd Airport to drop passenger charge for intl airlines

Syd Airport to drop passenger charge for intl airlines
By Hannah Edensor


Sydney Airport has agreed to drop the amount it charges international airlines per passenger for the 2015-16 financial year.

Wrapping up its negotiations with the Board of Airline Representatives Australia (BARA), Sydney Airport has emerged with a five year investment strategy, which will initially lower the passenger charge 18 cents to $24 from July 1 2015 to June 30 2016.

Sydney Airport will also work closely with carriers to enhance the overall passenger experience, as a key component of the new five-year pricing deal with BARA.

BARA represents the large majority of international carriers operating services to and from Australia’s largest airport as a collective bargainer and had been in negotiations with Sydney Airport over the deal for around a year, with the last agreement was due to expire on Tuesday, according to reports from SMH.

BARA executive director Barry Abrams told SMH he was “not aware” of any previous deal between carriers and Sydney Airport that had resulted in lowered charges.

However, the new deal will not become binding until it is agreed between Sydney Airport and individual carriers, as well as Qantas Airways and Virgin Australia Holdings, who are negotiating separately as well due to their prominent place at the airport.

As per SMH, Sydney Airport said the discussions with those carriers were “advanced”.

But despite the 0.74% drop per passenger for international airlines over the next year, the agreement will see charges in the following four years increase by 3.8% each year.

Per SMH, international airline pricing is vital to the airport, who received 42% of its revenue in 2014 from aeronautical services, with a massive 75% of this coming from international passengers.

The agreement also includes a five-year investment strategy that will up the ante for the passenger experience, as well as additional capacity to meet demand and more efficient operations.

“The new commercial agreement provides the framework for a closer working relationship with our airline partners to deliver an improved experience for passengers, our common customer,” Sydney Airport’s managing director and ceo Kerrie Mather said.

“This negotiation also demonstrates the benefits of commercial airport agreements that prioritise passengers, airline operating requirements and efficiencies, airport capacity and a service quality culture.”

The initiatives agreed upon are, according to SMH, understood to include more pre-emptive monitoring of cleanliness and maintenance of the terminal, an increase in baggage system capacity and a better aircraft parking system.

“They have already released the quantum of spend they plan to invest at the airport over the next five years,” BARA’s executive director Barry Abrams told SMH, referring to a $1.2 billion figure.

Per the newspaper, Sydney Airport’s latest airport monitoring report issued in April by the Australian Competition and Consumer Commission reported the average quality of service rating had improved within the “satisfactory” level in the 2013-14 financial year.

Passengers ratings remained unchanged at “satisfactory”, while airline ratings increased from “poor” to “satisfactory”.

Email the Travel Weekly team at traveldesk@travelweekly.com.au

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