Virgin Blue raises concerns regarding increases in airport charges

Virgin Blue today publicly raised concerns regarding increases in airport charges and the subsequent impact this will have on the tourism industry that is already reeling from the Ansett collapse.

Virgin Blue Head of Commercial, David Huttner stated:

"We note with disappointment that the Federal government rushed through the lifting of price caps last week without consultation with the airlines or the tourism industry.

The first impact of this hasty decision has been seen on the Gold Coast where the airport has chosen to raise its charges by over 170% and is using its monopolistic position to overcompensate for the loss of Ansett's 40% market share while ignoring Qantas' significant capacity increase.

There are certainly a lot of operators on the Gold Coast who couldn't even dream of increasing their prices by more than two and a half fold in these trying times.

While large amounts of revenue were derived by the Government during privatisation, Federal Treasury has now given airports a virtual blank cheque to cover their losses from the travelling public. Neither the airlines nor the public has been given any say in the matter.

This is not the first time since the Ansett collapse that policies have been rushed through without consultation. While the intentions may be good, the outcome is only going to further damage the tourism sector.

Qantas has already brought in aircraft from overseas and soon Australia will have a major airline that has virtually replaced Ansett's entire seat capacity on many key routes.

While Virgin Blue will have no choice but to pass on all of these additional charges to the flying public, we think it demonstrates a misguided belief by some that the travelling public will continuously tolerate being slapped with these hefty increases.

Virgin Blue has proven beyond doubt that more people fly if you lower the price, even by a few dollars. It's as simple at that.

With this in mind, the company will have no option but to operate its new Boeing aircraft on routes where the relevant airports act as responsible members of the community instead of as opportunistic monopolies."