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Sydney regional ring fence at risk – again?

written by WOFA | November 20, 2012
Regional airlines face renewed pressure from Sydney Airport as it seeks to optimise slot value. (Airservices)

Chairman of Sydney Airport Corporation (SACL) Max Moore-Wilton has created ire in the regional communities by again questioning the ongoing guarantee of regional airline access at Sydney Airport.

Under the so-called regional ring fence, regional airlines are assured a certain number of slots at Sydney Airport under legislation passed prior to the privatisation of the airport. SACL has been seeking for some time to have the ring fence relaxed in order to optimise its return from the available slots by making way for larger, higher capacity aircraft.

Regional Express (Rex) executive chairman Lim Kim Hai has called the comments by Moore-Wilton “irresponsible” and said “the ring fencing of regional slots was a result of the strong commitment of both coalition and labor governments.”

The Rex chairman went further, saying:  “SACL tendered for the purchase of Sydney Airport on this basis and would have reflected the legislated needs of regional NSW in their tender price. They knew exactly what the ring fenced slots were and factored that into the price they paid for Sydney Airport. To now call on the government to lift this restriction is simply a reprehensible money grab by Macquarie Bank, the owner of SACL. What SACL is trying to do is the equivalent of someone buying a house near Sydney Airport at a price that reflected it was next to an airport, and then lobby to close the airport so that their new house is worth more money. It is worth noting that SACL, because of its monopolistic position, has one of the highest, if not the highest, EBITDA margins of all airport operators in the world, standing at over 80 per cent compared to Heathrow, Hong Kong and Singapore at 51 per cent, 68 per cent and 52 per cent respectively.”

Sydney regional ring fence at risk – again? Comment

  • Scotty


    Australian airports were privatised so the then government could have money to throw at the next election. It worked but has cost Australians dearly, and for several generations. Canberra airport is a classic example of where the Government now pays several times more in rent to lease back office space than it yeilded from the ‘lease’.

    Talk about stupid economics. We should not expect much from Macquarie Bank other than the bill and a demand we pay up… Thats their business. Sydney airport is a disgrace by local and world standards, it’ll stay that way for decades to come. Unfortunately.

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