Paul Fletcher MP

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AFR - New airport to target tourists, business class

Paul in the Media Thursday, 04 May 2017

The new Western Sydney Airport will eventually target business travellers as well as budget travellers and will not just be a low-cost terminal, says Urban Infrastructure Minister Paul Fletcher.

Qantas chief executive Alan Joyce warned the new airport needed to be "lower cost than Kingsford Smith" and operate 24 hours a day to justify shifting its Jetstar operations to Badgerys Creek "There's no incentive for us to move Jetstar's operations if if s more expensive or the same cost," Mr Joyce told Macquarie's Australia conference in Sydney, adding some airports were high-priced 'Taj Mahals".

The Sydney basin can support two airports if it emulates the London model, where Heathrow is "very clearly" a premium airport and Stanstead, the hub for Irish airline Ryanair, is low-cost, Mr Joyce said.

"There isn't any reason why that couldn't be the structure in Sydney where Kingsford Smith is a huge Qantas hub with the slots that are currently being used by Jetstar potentially being used by Qantas in the very long term," he said. Qantas currently has 49 per cent of available landing and departure slots at Sydney Airport.

But Mr Fletcher said the government planned to build an airport that people in western Sydney could be "proud of.

"That will be important in the design values of the terminal, this will be a major public space, as airports always are ... The terminal will be a building that reflects the confidence and aspirations of western Sydney.

"It's not a case of saying this is a lowcost airport or a discount airport. It's a case of saying where are the market segments that you can have confidence from day one that Western Sydney Airport will have a very competitive position?" As Kingsford Smith Airport reached capacity, more flights were expected to shift to Badgerys Creek, he said.

"Over time, you will see an increasing number of services at Western Sydney.

Airport that target the business market as well as the leisure market, or the visiting friends and relatives market" Virgin said it was "likely" that both Virgin Australia and Tigerair would operate some services from the Western Sydney Airport Sydney Airport chief executive Kerrie Mather told The Australian Financial Review the airport served 50 per cent of the premium seats into Australia and had "a natural competitive advantage" due to its proximity to the CBD and Sydney's position as the nation's financial capital.

"There's no question that we will remain a very significant business hub because of that location," she said.

The airport is planning to build a fourth terminal, enabling it to "premiumise" the current T2 terminal, from which Jetstar and Tigerair currently operate, Ms Mather said.

Citigroup analyst Anthony Moulder said other big cities, such as London, operated several airports successfully, pointing out that Heathrow's traffic and financial performance had improved despite its flight slots being full for the past 10 years. Sydney Airport still has about 35 per cent of its slots available.

But Macquarie analysts warned international passenger growth at Sydney could slow after Brisbane and Melbourne opened new runways over the next 10 years.

Brisbane Airport Corporation CEO Julieanne Alroe said the airport's location near major northern hemisphere global hubs, 24-hour operation and expanding domestic network positioned it "very favourably".

Melbourne Airport CEO Lyell Strambi said Sydney Airport was at capacity during peak periods.

"Melbourne Airport also needs to grow as our intake of international passengers continues to swell, but we have the great advantage of being able to grow at the existing airport," he said.

"This is a far more efficient option for airlines, and it's better for passengers who benefit from one single airport" It's not a case of saying this is a lowcost airport or a discount airport.

Authorised by Paul Fletcher MP, Level 2, 280 Pacific Highway Lindfield NSW 2070.

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