myshoutcaptain
20th Jun 2009, 09:12
WA air routes to stay free of competition : thewest.com.au (http://www.thewest.com.au/default.aspx?MenuId=146&ContentID=149383)
WA air routes to stay free of competition
Transport Minister Simon O’Brien has rejected a departmental recommendation to deregulate most of WA’s protected marginal air routes.
He will renew the licences for two exclusive networks and individual routes for a year before awarding more comprehensive, long-term contracts.
Mr O’Brien confirmed information obtained by The West Australian at this week’s Paris Air Show that he was not convinced total deregulation of WA air routes — particularly in the depressed economic climate — would benefit the State.
The two main contracts, Skywest Airlines’ coastal network licence and the inland network licence (Goldfields) held by Skippers Aviation, were designed to give the airlines a mix of unprofitable and marginal routes on the condition they maintained services to all centres.
Mr O’Brien said he rejected parts of a Department of Planning and Infrastructure report that recommended dismantling most air route protection because he was responsible for stable and regular air services to centres that could not support competition.
He would offer 12-month licence extensions while he worked with the industry and interested parties to develop a long-term contract to enable the airlines to buy new planes.
“These airlines need long-term stability to convince bankers to finance new aircraft,” he said. “I am looking at possibly a five-year contract with an option for five years.”
Rather than just read the 89-page report, Mr O’Brien sought copies of all 22 submissions and read them.
He conceded some people would not be happy with his decision but said that since 1960, 43 regular passenger airlines — including two this year — had collapsed in WA.
“The airline industry is in a delicate stage and it needs certainty where there is uncertainty at the moment,” Mr O’Brien said. “The State needs stability and by granting licences for these mostly marginal routes, I can demand a certain level of service for passengers and communities.”
However, there might be special cases, such as Exmouth which was growing rapidly. “I will be visiting all communities to discuss the issue at length as we work towards the longterm contract definition,” he said.
He said the 12-month extension was not to maintain the status quo but a chance to work on longer-term contracts that would benefit WA and improve services.
GEOFFREY THOMAS
Interesting to see what either company would buy fleet wise and what the breakdown of the routes would be.
:}
WA air routes to stay free of competition
Transport Minister Simon O’Brien has rejected a departmental recommendation to deregulate most of WA’s protected marginal air routes.
He will renew the licences for two exclusive networks and individual routes for a year before awarding more comprehensive, long-term contracts.
Mr O’Brien confirmed information obtained by The West Australian at this week’s Paris Air Show that he was not convinced total deregulation of WA air routes — particularly in the depressed economic climate — would benefit the State.
The two main contracts, Skywest Airlines’ coastal network licence and the inland network licence (Goldfields) held by Skippers Aviation, were designed to give the airlines a mix of unprofitable and marginal routes on the condition they maintained services to all centres.
Mr O’Brien said he rejected parts of a Department of Planning and Infrastructure report that recommended dismantling most air route protection because he was responsible for stable and regular air services to centres that could not support competition.
He would offer 12-month licence extensions while he worked with the industry and interested parties to develop a long-term contract to enable the airlines to buy new planes.
“These airlines need long-term stability to convince bankers to finance new aircraft,” he said. “I am looking at possibly a five-year contract with an option for five years.”
Rather than just read the 89-page report, Mr O’Brien sought copies of all 22 submissions and read them.
He conceded some people would not be happy with his decision but said that since 1960, 43 regular passenger airlines — including two this year — had collapsed in WA.
“The airline industry is in a delicate stage and it needs certainty where there is uncertainty at the moment,” Mr O’Brien said. “The State needs stability and by granting licences for these mostly marginal routes, I can demand a certain level of service for passengers and communities.”
However, there might be special cases, such as Exmouth which was growing rapidly. “I will be visiting all communities to discuss the issue at length as we work towards the longterm contract definition,” he said.
He said the 12-month extension was not to maintain the status quo but a chance to work on longer-term contracts that would benefit WA and improve services.
GEOFFREY THOMAS
Interesting to see what either company would buy fleet wise and what the breakdown of the routes would be.
:}