Adelaide Airport calls for a return to network charging

written by australianaviation.com.au | June 8, 2011
Adelaide Airport has called for a return to network pricing.

The South Australian government has backed moves by Adelaide Airport Ltd to reduce terminal navigation charges for airlines at airports with lower passenger numbers, writes Chris Milne.

The airport operator says the high ‘location specific’ charges by Airservices Australia can thwart its efforts to attract more international airlines to Adelaide and also impact on domestic frequencies.

AAL wants changes to the present formula for charges, claiming it is inequitable and disadvantages lower-volume airports.

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It is seeking a return to the former network charging system, which would give Adelaide Airport parity with other capital city airports – although it would increase charges at other major airports, particularly Sydney and Melbourne.

Along with Hobart, Cairns and Darwin airport operators, it has asked the present Productivity Commission review of  airport charges to examine the inequities and consider the reintroduction of network charges across all airports.

The SA government has made a separate submission to the commission, supporting AAL‘s position.

SA Transport Minister Patrick Conlon said the present system heavily disadvantaged lower-volume airports, discouraging new services and pushing up passenger ticket prices.

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The commission is due to hold hearings with all airports on June 30 to discuss the submissions, before making recommendations to the federal government.

AAL’s general manager of corporate affairs, John McArdle, said Airservices Australia charges were markedly higher for Adelaide than other mainland capital city airports.

Using an A330-300 as an example, he said, the terminal navigation charge for Adelaide was $4788 for a international flight turnaround, compared with $1884 for Melbourne and $1868 for Sydney for the same aircraft. It was almost $1600 above Perth, the next highest among mainland capitals.

Even Boeing 737 charges were markedly higher for Adelaide than other major airports.

The airport charges were location-specific, even though Airservices Australia had common charges for its network services.

McArdle said AAL’s own charges were in the middle of the range of other major airports.

The higher Airservices charges were an important factor – “but not the only factor” – in moves to bring more overseas and domestic services to Adelaide.

The operator has been working hard to attract more overseas airlines to Adelaide, including Emirates and Etihad, which are still high on its agenda, as well as Asian carriers such as China Southern, Thai International and Vietnam Airlines.

Its only success so far has been the introduction of a handful of Vietnam Airlines charters, which are expected to be repeated this summer.

“We are discussing RPT services with Vietnam Airlines, and we‘re in close discussions with China Southern,” he said.

New aircraft deliveries to the Chinese carrier could be a key to obtaining a direct service through Adelaide.

However, none of the potential airline candidates had committed to Adelaide services yet.

Meanwhile, Adelaide Airport’s new road system is due to open on July 28, enabling work to begin on the planned multi-storey car park to replace the present open-air car park and provide spaces for 2000 vehicles. This will more than double the present short-term spaces, and give direct, covered access to the terminal. The work is part of a $100 million project to upgrade the airport.

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