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Perth Airport and Qantas Resolve Latest Ongoing Dispute

A Qantas 787-9 performs a test flight at Paine Field. (Photo: AirlineGeeks | Katie Zera)

According to Perth Airport, Qantas Airways and the airport have reached an agreement to ensure the essential services Qantas provides to Western Australia, including vital flights, freight services and repatriation flights can continue. Both parties haven’t revealed the details of the settlement of the feud.

This is not the first dispute between Perth Airport and Qantas over the past few years. A legal case over an unpaid sum of aeronautical fees in 2018 has not yet to be settled. Perth Airport and Qantas have also agreed to a revised timeline for finalizing the sale of Terminal four from Qantas.

Earlier, Perth Airport complained bitterly that its largest customers, Qantas and Virgin Australia haven’t paid aeronautical fees since January. The airport was owed $20 million AUD ($13 million USD) by Qantas and threatened to terminate most of Qantas’ leases if the airline refused to negotiate.

In response to the dispute, Mark McGowan, Premier of Western Australia said, “This is threatening our economic future and is completely unacceptable.”

Perth Airport said Qantas and Virgin Australia operate essential business at the airport, such as fly-in-fly-out (FIFO) traffic, which brought workers to the region during the ongoing pandemic. According to Perth Airport, the Qantas Group has flown more than 10,000 flights since Feb. 1 and operates around 350 flights a week through Perth. The airport believes Qantas is profiting from those essential flights, without paying the airport.

In addition, Virgin Australia owed the Perth Airport $16.5 million AUD ($10.8 million USD) and the carrier went into administration last month. In the meantime, Virgin Australia’s aircraft are no longer physically blocked at the airport following a written assurance from the administrators.

The coronavirus pandemic has resulted in weakened travel demand globally. Perth Airport has seen a drastic fall in passenger traffic throughout the last few months.

“Our passenger numbers and revenue have simply fallen off a cliff,” Kevin Brown, CEO of the airport, said. Perth Airport recorded only 193,000 passengers in April, with the loss of more than one million passengers compared to the same time last year.

“You would most probably have to go back to the 1960s to see interstate and international passenger numbers as low as these,” Brown added. In light of the decline in passenger traffic, Perth Airport’s Terminal two and four are fully open. Meanwhile, the airport expects a loss of $100 million AUD ($65 million USD) in revenue for the financial year.

Pete Ainsley

Author

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