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The outgoing boss of Sydney Airport has joined the chorus of aviation industry voices calling for more international competition, after the federal transport minister rejected an application from Qatar Airways to double its flights to Australia.
Sydney Airport chief executive Geoff Culbert said strong growth in arrivals to the airport from China, South Korea and India had offset lagging markets including the US and New Zealand, but traffic from the Middle East remained well below pre-COVID levels, down 27 per cent on 2019.
Sydney Airport boss Geoff Culbert.Credit: Brook Mitchell
“The headline result for international passengers is encouraging, but it’s a two-speed recovery,” Culbert said. “The lag is being driven by a lack of seat capacity rather than a lack of demand.”
Minister for Transport and Infrastructure Catherine King has been criticised over the federal government’s controversial decision to reject Qatar Airways’ application to double its number of weekly flights to Australia. Qatar’s application was supported by the bulk of the aviation industry as well as, according to industry sources who spoke on the condition of anonymity, the Department of Foreign Affairs and Trade, Austrade, various airport owners and all state governments.
The application was not welcomed by Qantas, which has a code share arrangement with Qatar’s fellow Middle Eastern carrier Emirates and flies to Europe via Singapore. There was also opposition from a group of women who are suing Qatar Airways after being invasively searched before a flight in 2020.
While Qantas and Qatar Airways are both in the Oneworld airline alliance, Qatar has a code share partnership with Qantas’ domestic rival Virgin Australia.
King has offered various justifications for rejecting Qatar Airways’ applications, ranging from the extra flights not being in the country’s national interest, to the extra flights having the potential to affect Australian jobs.
Allowing Qatar to make 21 flights each week would have lowered the cost of international airfares, and some economists estimated it would have generated an additional $500 million in tourism revenue and thousands of jobs.
Melbourne Airport chief executive Lorie Argus said last week that it was time for the federal government to increase the number of open skies agreements with other countries to make it easier for foreign airlines to fly here.
Culbert also doubled down on previous allegations that the local airlines are deliberately axing scheduled flights to fend off competition for slots, pointing to Sydney Airport’s domestic recovery, which has been stagnant for the past 15 months.
“We continue to see evidence of unused slots going to waste, with a persistent mismatch between slots held by domestic airlines and the schedule that is flown,” he said.
It’s the second time in two months the airport boss has called out Qantas and Virgin Australia for what he deems to be slot hoarding.
Qantas said last month it “completely rejects” the notion it is hoarding slots at Sydney Airport.
Airlines are required to operate at least 80 per cent of their allocated slots to keep them. Qantas said it uses more than 90 per cent of its slots.
“There does seem to be some misdirected frustration from Sydney Airport because they wish the system was different, and they could unlock more revenue. We understand that, but we’re not sure demonising your biggest customer is the way to go about it,” Qantas domestic chief Andrew David said this month.
Flight cancellations are sometimes inevitable as a result of issues such as weather and staffing problems. Hundreds of flights out of Sydney Airport were affected by weather-related issues in the past two months, forcing the airport to switch to single-runway operations multiple times.
A total of 3.8 million passengers passed through Sydney Airport in July. About 1.3 million travellers came on international flights, meaning the international recovery has overtaken domestic for the first time since COVID-19 restrictions were relaxed.
Chinese travellers returned in July to being the biggest group of foreign passport holders at the airport for the first time since COVID-19. Before the pandemic in 2019, 1.4 million Chinese tourists spent $2.1 billion in Australia. Last week, China lifted a ban on group tours travelling to various countries including Australia.
The number of South Korean nationals through Sydney Airport has increased 20 per cent on the same corresponding period in 2019, reflecting the increased popularity of the Seoul-Sydney route, which is now flown by five airlines instead of two.
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