Darwin is one step closer to becoming an aviation hub with Jetstar’s new services, but the emissions trading scheme and high security costs may stand in its way.
Jetstar has launched direct services from Darwin to Sydney and Ho Chi Minh City, China, which will operate five times a week out of Darwin Airport.
The new services now enable passengers from Cairns, Sydney, Melbourne and Adelaide to transfer from domestic services to Singapore and Ho Chi Minh in both directions.
“Darwin is now connected to all eastern seaboard capital cities by Jetstar…Today is an important milestone in the development of our Darwin hub to connect Australia with South East Asia,” said Bruce Buchanan, Jetstar general manager commercial.
The carrier is planning to build its Asian hub in Darwin, with up to seven aircraft to be based in the region by 2013.
However, the company said the Darwin hub plan could be thwarted if the Federal Government does not exempt domestic aviation from its emissions trading scheme.
Mr Buchanan told Fairfax that the scheme would force up the company’s fares, while its international rivals maintain competitiveness.
“Our hub strategy funnels traffic through Jetstar’s domestic network from ports such as Melbourne, Sydney, Brisbane and Adelaide up through Darwin and then into near Asian ports such as Ho Chi Minh City and Singapore,” he said.
“The domestic legs of these Jetstar flights will attract a carbon charge while international carriers flying over the top of Darwin and hubbing in Asian ports will not be subject to any carbon charge at all.”
The recently announced Darwin hub plan is expected to create 570 jobs and attract an additional 250,000 tourists to the region.
While welcoming the new services, Darwin Airport CEO Ian Kew said relatively high security costs at the airport could be another barrier to future development.
According to Mr Kew, the government-mandated security measures account for 57 per cent of total airport costs for international passengers at Darwin Airport. Security costs at Australia’s major gateways range from 12 to 30 per cent of total airport charges.
“The Territory is particularly dependent on air links for tourism and air freight.
“While airlines such as Jetstar have added services…the main factor impacting on our competitiveness is that we are a small regional airport that is required to have major city airport security – that creates a disproportionate impost,” he said.