06/05/2020 - 15:14

Perth Airport, Qantas feud escalates

06/05/2020 - 15:14

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Perth Airport has hit back at Qantas chief executive Alan Joyce after he claimed the airport had refused to relieve the airline of rent and passenger fees during the COVID-19 pandemic.

Perth Airport, Qantas feud escalates
Perth Airport claims Qantas has refused to pay charges for more than 10,000 flights it had operated since February. Photo: Gabriel Oliveira

Perth Airport has hit back at Qantas chief executive Alan Joyce after he claimed the airport had refused to relieve the airline of rent and passenger fees during the COVID-19 pandemic.

Mr Joyce had singled out Perth Airport this morning for what he said were its aggressive and unaccommodating tactics in negotiating aviation and lease payments for the months of February and March.

That came after Perth Airport chief executive Kevin Brown said on Monday that Qantas owed the airport around $20 million in unpaid fees dating back to January.

In response to Mr Joyce’s comments, a spokesperson for Perth Airport disputed claims the airport had been uncooperative during negotiations, saying Qantas had refused to pay charges for more than 10,000 flights it had operated from the airport since February.

The spokesperson said Qantas had informed the airport in April that it would cease to pay rent on any of its leases, and that it would not pass on airport charges it had collected from passengers for the months of February and March.

“There was no consultation and no negotiation,” the spokesperson said.

“It was a take it or leave it directive from Qantas.

Mr Joyce is correct to say Perth Airport has ‘more flying’ than any other airport in Australia.

“What Mr Joyce neglects to mention is that Perth Airport is not being paid by either major airline for any of these flights.

“Qantas demands that Perth Airport provides the full range of terminal and airfield services so that it can generate cash flow and profit from these FIFO flights.

Mr Joyce’s idea of ‘a deal’ is that Qantas should be allowed to pay nothing to Perth Airport for these services.

“Qantas is profiting from these flights, accepting money from passengers and FIFO companies for the airport’s charges, but refusing to pass this money on.

“In essence, Perth Airport’s shareholders – superannuation funds who represent the retirement savings of around 8 million Australian workers – are being used as a short-term debt facility for Qantas.

“Despite Qantas’s behaviour, Perth Airport has written to the airline offering to consult and negotiate with them.

“To suggest Perth Airport has not been open to consultation is disingenuous, to say the least.

“We have been approached by around half of our airline partners since the outbreak of the coronavirus and on each occasion, we have been willing to consult, listen and look for ways to assist.”

Recent sparring over unpaid fees comes after years of arguments between Perth Airport and Qantas, with the two at odds over the details of Qantas relocating from its existing terminal ahead of the airport’s plan to complete major renovations by 2025.

Those disputes had led in part to the airport taking the carrier to the Supreme Court of Western Australia in 2018, alleging it owed $20 million in unpaid fees.

Qantas has disputed that figure, with the case ongoing.

Mr Joyce this morning had claimed Perth Airport owed the airline $200 million for that terminal, echoing similar claims made by Qantas International chief executive Tino La Spina on Tuesday.

In response to that comment, Perth Airport’s spokesperson insisted the terminal was worth just $50 million, and that an independent assessor had been appointed to resolve the matter.

“Qantas is fully aware of the situation as they have agreed to the process which they are now seeking to undermine by linking it to settling its own debts and inappropriately commenting publicly on the issue while it is being independently determined,” the spokesperson said.

Perth Airport announced on Monday that it had lost more than 1 million passengers since April of last year.

Last month, it stated that it had lost more than $100 million since the COVID-19 pandemic arrived in Australia.

Qantas informed the ASX yesterday that it had secured $550 million in debt funding, and confirmed it would extend flight cancellations through to the end of July.

The airline closed at $3.50/share this afternoon, down from $3.62/share at opening.

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