Airfares are likely to go up thanks to a 43% growth in major expansion work at Australia’s four largest airports in the last financial year.
The fare increase will be the result of airports wanting to recover costs by charging airlines more, the Australian Competition and Consumer Commission (ACCC) says.
The ACCC’s latest Airport Monitoring Report shows that the Brisbane, Melbourne, Perth and Sydney airports collectively spent $1.5 billion in 2024-25 to expand capacity, upgrade terminals and improve access.
And the four airports plan to spend $20 billion on infrastructure over the next 10 years.
Continual spending is needed to ensure these airports can handle traffic growth with the four airports collectively handling about 120 million passengers in 2024-25, ACCC Commissioner Anna Brakey says.
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AIRFARES PRESSURE
“Large capital programs are likely to place upward pressure on airport charges paid by airlines, which may result in higher airfares for passengers as these costs are recouped,” she warns.
“It is important that airport charges reflect sensible and timely investment decisions, efficient costs and a rate of return that matches the risks involved.”
She points out that the four airports also intend to spend almost $20 billion in major infrastructure projects over the next decade.
Upcoming major projects include a new terminal and runway at Perth, a third runway at Melbourne (Tullamarine), Sydney’s integrated T2 and T3 domestic terminals and a third mixed terminal at Brisbane.
A new 24-hour international airport is due to open in Western Sydney later this year; a spokesman for the ACCC confirmed to NewsCop that they intend to monitor the new airport as well.
The ACCC says airport charges are not regulated and that it consistently raised concerns that its current monitoring is inadequate and ineffective.
It wants binding commercial arbitration to settle disputes between airports and airlines, more detail in financial data provided to them and for the Productivity Commission to launch a new inquiry into airport regulations are adequate.
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