Majority of Australia’s Airports Incur Losses, Says Peak Body
The CEO of AAA expressed concern that new legislation could further burden regional airports, worsening their financial situation.
According to Australia’s peak airport body, six out of ten airports in the country are currently operating at a loss. At a recent parliamentary inquiry, Simon Westaway, CEO of AAA, highlighted the challenges faced by airports in Australia due to the complexity of the aviation sector.
Westaway pointed out that around 200 airports in Australia are managed by local councils, with at least 60% of them operating at a loss. He emphasized that regional airports have a different business model compared to major airports in capital cities like Sydney, Melbourne, Brisbane, and Perth.
He explained that major airports deal with significantly higher passenger flows compared to regional airports. In the financial year 2023-24, major airports saw over 97 million passenger throughputs, while regional rural airports had just over 18 million in throughput.
Westaway raised concerns about a proposed bill introduced by the Labor government in November 2024—The Transport Security Amendment (Security of Australia’s Transport Sector) Bill 2024. The bill aims to enhance security in the transport sector, particularly in aviation and maritime transport. However, Westaway stated that the bill could lead to duplication of regulations, increasing compliance costs for airports.
He warned that the implementation costs of the bill could reach nearly $1 billion over the next decade, posing a significant financial burden on the aviation sector, especially small regional airports.
Westaway also highlighted that these additional costs would ultimately be passed on to passengers, increasing travel expenses and disproportionately affecting regional and rural aviation. He stressed the importance of considering the impact of legislation on the industry and urged for more thoughtful policymaking.
During the inquiry, a member of the committee questioned the Home Affairs Department about the cost implications of the new legislation. The Department responded by stating that the issue of passing costs to consumers would be up to airports and airlines to manage. They also mentioned that they had received limited input from the industry regarding cost modeling.
Overall, while there were concerns about the potential burden of the new legislation, not all airports would be affected, as some are already regulated under existing acts.
