NSW: Virgin Blue declares it won't succumb to "ransom"

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NSW: Virgin Blue declares it won't succumb to "ransom"

SYDNEY, Aug 14 AAP - Virgin Blue would upgrade its existing facilities rather thansuccumb to "ransom" by Sydney Airports Corporation for access to the former Ansett terminal,CEO Brett Godfrey said today.

The airline would stay in the domestic express terminal to ensure continued low fares,Mr Godfrey told reporters at the airport.

"Gates at the former Ansett terminal appear to be grossly overpriced and are hamstrungby expensive big airline dinosaur technology that is incompatible with Virgin Blue's efficientmodern, low-cost systems," he said.

"The only alternative is to increase airfares to pay the exorbitant rents being demandedby the controlling shareholder of Sydney airport, Macquarie Bank."

Mr Godfrey said he would love the Australian Competition and Consumer Commission (ACCC)to get involved in the issue.

"I'd love Allan Fels (ACCC chairman) ... to get very involved in this because we arebeing held to ransom."

Earlier today, Prof Fels said access to the former Ansett terminal at the newly privatisedSydney Airport had become a significant competition issue.

"Any agreement between Sydney Airport and the incumbent airlines (Qantas and VirginBlue) to tie up available gates at the Ansett terminal will create a significant hurdleto new entry," he said.

"The commission will monitor any developments closely."

Mr Godfrey told reporters Virgin Blue was told if they did not like the terms and conditionsfor use of the former Ansett terminal they could fly out from the regional airport, 112kilometres away.

"That's how these guys do business and we are just saying it's not right. We will standup for it and if it takes us a year we are going to get a fair result I think."

Patrick Corporation CEO Chris Corrigan accused the new owners of Sydney Airport, MacquarieBank, of trying to "extort ridiculous charges from the travelling public".

Patrick Corporation is a 50 per cent shareholder in Virgin Blue.

"Macquarie paid far too much for the airport and have since reneged on an agreementwith Virgin Blue for cost-efficient and reasonable access to the terminal," Mr Corrigansaid.

He said Virgin Blue would not become a tax collector for the bank.

Asked whether he thought SACL would come back with another offer, Mr Corrigan said:"Based on their performance so far I would not be hanging over a cliff waiting for it."

"We see it as an alternative to stay here. It's not the ideal alternative. Clearlyit would be a hell of a lot easier if we could move into the (former) Ansett terminalon reasonable terms and conditions without having to put airfares up."

A Sydney Airports Corporation spokesman said he did not believe there was ever a dealwith Virgin Blue over access.

"We stand ready to talk to Virgin Blue over their concerns over access to the terminal," he said.

"The door is open."

He said they offered six branded gates and up to six unbranded multi-user gates toVirgin Blue to expand their business.

The spokesman said the airline was offered a five-year lease with another five-year option.

AAP as/arb/jnb/sb

KEYWORD: AIRPORT VIRGIN LEAD