AIRPORTS: Sydney Airport slots manager changes — Qantas and Virgin Australia company booted

Qantas and Virgin Australia’s dominance over landing slots at Sydney Airport has been disrupted. A new incumbent has secured the government-led tender.

New slot manager to take the reins

The successful bidder, Airport Coordination Limited (ACL), has experience managing slot regimes at the world’s busiest airports. That includes places like Heathrow, Gatwick, and Dubai. This is a significant change as ACL replaces the Qantas and Virgin Australia joint venture, Airport Coordination Australia (ACA). (Incidentally, they have a splash page on their site answering what they feel are false claims about Sydney Airport slots)

For years, ACA has been responsible for allocating landing slots at Sydney Airport, a role it has held since the scheme’s inception in 1997. Sydney Airport and the Regional Aviation Association of Australia also held stakes in ACA.

A step towards transparency and competition

Sydney Airport’s CEO, Scott Charlton, welcomed the change, emphasizing that the appointment of an independent slot manager is a positive move for transparency and competition.

“Sydney Airport will continue to work constructively with all stakeholders on the implementation of further commitments, including a recovery period and a strengthened compliance regime.”

Scott Charlton, Sydney Airport CEO

The battle for peak hours

Sydney’s curfew-driven limited capacity for incoming flights makes landing slots highly coveted, particularly during the busy morning period. These constraints, plus noise restrictions, have sparked concerns about slot hoarding. It is claimed that Qantas and Virgin Australia were cancelling flights last minute to prevent rivals from accessing the slots.

The Australian Competition and Consumer Commission (ACCC) has noted improvements in flight cancellations in its latest domestic aviation report. The shake-up in slot management comes as the government begins auditing the reasons behind flight cancellations, a move influenced by pressure from consumer groups and airports.

Market share shifts amid changes

Virgin Australia’s market share has increased to 35% in the final quarter of 2024, marking a 3% rise in passenger numbers across the market. Qantas Group (including Jetstar and QantasLink) saw a 5% increase in domestic passenger numbers during the December quarter, outperforming their growth expectations.

Despite high airfares, the ACCC’s latest report shows that prices have fallen in real terms compared to December of 2023. Fares remain elevated due to ongoing capacity constraints.

2PAXfly Takeout

With International firm ACL now overseeing Sydney’s landing slots, the competitive landscape at Australia’s busiest airport is set to evolve. We will soon see if the old company controlling slots, Airport Coordination Australia, was unduly influenced by some of its shareholders, Qantas and Virgin Australia.

Changing the guard to ACL could facilitate more equitable access and improved service for passengers.