Could Australia's newest airport finally bring airfares down?

in brief

Western Sydney International Airport (WSI) will open to the public on Sunday 25 October.

Flights to and from WSI will increase the overall air traffic for Sydney.

Australian airfares are among the most expensive in the world, and prices have soared since the pandemic. The opening of a major new airport in Western Sydney could revolutionise that system.

On Wednesday, it was revealed that Western Sydney International (WSI) Airport would open to passengers on 25 October, with Jetstar offering 21 domestic services per week and Qantas joining them with eight flights per week from March.

When it opens, the airport will be able to handle up to 10 million passengers per year, with a capacity to become "Australia's primary gateway", servicing some 82 million passengers annually by 2063 — on par with London's Heathrow Airport at present.

Aviation experts have told SBS News that the change will fundamentally alter the country's airfare market and could drive prices down for consumers by opening up air travel capacity.

Some Reddit users pointed out that with rail links that may not be ready until 2028, getting to the airport could theoretically incur a cost that would be similar or more than the savings on a ticket.

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Five new bus services will commence in July, as well as rideshare access.

Professor Daniel Gschwind, former CEO of the Queensland Tourism Industry Council, told SBS News that the opening of WSI is a "matter of national interest" as it removes the current bottleneck of Sydney's existing Kingsford Smith Airport.

"Having a curfew-free airport in Sydney will certainly ease the pressure on prices and it will make it more attractive and more possible for current and potential new carriers to fly into Australia," he said.

WSI will not be subject to the same curfews as Sydney's current airport, allowing passengers to fly during the normally restricted hours between 11pm and 6am.

In addition, Kingsford Smith's residential and Botany Bay surroundings make expansion difficult, although it's projected to increase from 41 million passengers annually to 72 million by 2045.

Professor Ron Bartsch, founding director of Avlaw Aviation Consulting, told SBS News that the only way aviation prices are going to come down in Australia is by increasing capacity — something WSI offers, driving Kingsford Smith to compete with it.

"The incumbents aren't going to reduce the airfares unless they have to, and they won't have to unless there's competition," Bartsch said.

Australia's aviation industry is notoriously concentrated, with Qantas and Virgin dominating the market — something that has long constrained market competition.

Bartsch, a former director of regional airline Rex, said that the Qantas-Virgin duopoly stopped the smaller airline from being able to "effectively compete" for slots at Kingsford Smith.

With the opening of WSI, he argued that the airport "certainly has the potential" to lower fees and increase competitiveness, due to increased aviation slots for landing aircraft and greater viability for rival operators.

"Western Sydney has 24/7 access, meaning airlines can get greater utilisation out of the aircraft by flying them at a time when they would otherwise be on the ground," he said.

A potential competitor swoops in

Peter Kelly, a former Ansett and Qantas executive, is seeking to capitalise on what he calls a "once in a generation" opportunity with the launch of a new low-budget carrier, Zinc Airlines.

"Western Sydney breaks the nexus and it changes domestic air travel forever," he told SBS News. "The market will become far more competitive."

Without the opening of new capacity, Kelly said the business model for a new domestic airline just isn't there in Australia.

The country has a long history of similar failed ventures.

His primary competition will be Qantas subsidiary Jetstar, which dominates the Sydney-Melbourne passage, one of the busiest and most profitable routes in the world.

Zinc is in the capital accumulation phase of their business plan at the moment, and Kelly is reluctant to lay out a timeline for when the airline could be operational, but it "certainly won't" be this year.

The airport's first international routes already went on sale earlier this year, with flights to Singapore and Auckland, New Zealand, starting in October and November, respectively, operated by national carriers.

Australia 'dependent' on air travel

This week, Prime Minister Anthony Albanese said that, when he commissioned a study into the project in 2011, it "wasn’t a matter of if Sydney needed a new airport, but when".

However, Gschwind cautions that because the growing scale of air travel is unavoidable for an island nation, the opportunity must be taken to expand aviation sustainably.

"Australia is a country that is so dependent on aviation access, and with emissio…