Sydney’s second airport finally receives go ahead

It has taken more than half a century of fierce political debate but finally construction of Sydney’s second airport will commence next year, with the Australian government footing the bill.

June 1st 2017

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Macquarie’s Sydney Airport Group, operators of Australia’s major gateway, Kingsford Smith International Airport, held the first option to build and operate the city’s second airport at Badgerys Creek, but after three years of mulling the commitment, the answer turned out to be a definite “no thanks”. Read More »

The reason, said the airport’s CEO, Kerri Mather, was financial risk. The decision was expected, given the company has said Badgerys Creek would be a “challenging investment proposition”.

Risky or not, the Australian government has decided another airport is a necessity for Sydney.

In the conservative Coalition government’s annual budget last month, US$3.8 billion was set aside for the project. The first stage will involve a terminal capable of handling up to 10 million domestic and international passengers a year and a single 3,700 metre runway. The design allows for a second parallel runway and expansion of the terminals to cater for 37 million passengers annually by 2050 and 82 million a year in 2063. Badgerys Creek is 50 kilometres west of Sydney’s city centre.

The government is setting up the Western Sydney Airport Corporation (WSAC) to oversee the project. Competitive tenders will soon be launched for the design and construction, scheduled to begin in the second half of next year. The airport is planned to open in 2026.

Australian Prime Minister, Malcolm Turnbull, said it was a vitally important project for the country that will create 20,000 jobs by the early 2030s and 60,000 in the longer term.

A second airport for Sydney was first mooted some 70 years ago. Successive governments have either announced the project would go ahead or shelved it.

Kingsford Smith is becoming increasingly congested and its expansion is hampered by a night curfew and a cap of 80 movements an hour on flights. Badgerys Creek, which lies in the heart of Sydney’s western suburbs; is a major engine of growth for the state.

Most full service carriers are expected to continue to use Kingsford Smith because of its convenience to the centre of Sydney.

Analysts believe Badgerys Creek will evolve primarily into a low-cost airline hub that will attract air cargo and private jet business. Qantas Airways chief executive, Alan Joyce, who has warned against building a “Taj Mahal”, has hinted the new airport could be a base for the carrier’s budget airline, Jetstar.

“Standsted [in London] is very clearly a low-cost airport. It’s the biggest hub for Ryanair, which has the biggest operation across Europe,” he said.

Australia’s competition watchdog, the Australian Competition and Consumer Commission (ACCC), said in March an independent or government-owned airport at Badgerys Creek would be a win for airlines and the passengers they carry.

“This has raised the possibility of increased competition with Sydney Airport to the long-term benefit of consumers and the economy. A second international airport competing with Sydney Airport could yield significant benefits to consumers and airlines,” it said.

Just how much competition Badgerys Creeks will present to Sydney’s main airport remains to be seen. But one Australian businessman has said the government was spending too much on the project.

John Wagner, along with his brothers, built Brisbane Wellcamp Airport near Toowoomba, Queensland. He claimed he could build Badgerys Creek for much less than the government is spending. Wellcamp (Cathay Pacific Airways operates cargo flights out of the airport) has a 2.87 kilometre runway that can handle aircraft as big as a B747.

Wellcamp was built in 19 months and 10 days and cost A$200 million (US$145 million). As well as building Badgerys Creek for less money, Wagner said he could have it up and running in three years – five years ahead of the government’s scheduled opening of the facility.