Page 72 - AA 2018_11

Complex and often difficult “Taking into consideration the The AAA says airports have only include an agreed level of service,
Airports Council International (ACI), limited market power of the airport invested $15 billion since but detailed plans for the future
which is the global trade association industry in Australia, ACI’s position 2002, including $10 billion on development and investment of the
for the world’s airports whose is that there are objective reasons aeronautical improvements. airport,” Melbourne Airport said.
members include operators of about to continue applying a light-handed rob finlayson “Consultation on planned
2,000 airports, told the Productivity regulation of airports.” investment forms a key part of the
Commission airports in Australia had Brisbane Airport acknowledged negotiation process, which results
a “significant degree of dependence on in its submission to the inquiry in the most efficient solutions being
two airline groups – Qantas Group that charges for the use of the found to what are complex challenges,
and Virgin Australia Holdings”. runways, terminals and associated particularly when growth in demand
It noted Qantas and its Jetstar infrastructure had increased as it has been so strong.”
unit had more than 50 per cent invested in the facility. Further, Melbourne Airport said
marketshare, while Virgin Australia However, it said the “average price that as a federally-leased airport, it is
had about 25 per cent share. increases have not been excessive in light required to provide access to airlines
“Airlines are consequently able to of these investments and the considerable that request it.
exercise a potential buyer power that volume risk” borne by the airport. “This, alongside the current
fully offsets or countervails any market “This is evidenced by BAC’s modest threat of the light-handed regulatory
power the airport might enjoy,” the rate of return on assets over the past regime, the countervailing power
ACI submission said. 10 years,” Brisbane Airport said. of airlines, and the incentives for
“These factors have de facto Melbourne Airport described its Melbourne Airport to grow, means
prevented the airport operator from negotiations with airlines as “complex it is not in the interest of Melbourne
applying a monopolistic behaviour and and often difficult”. Airport to simply adopt a ‘take it or
setting excessive charges. “They involve agreements that not leave it’ approach to negotiations,” its

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