Fed: Virgin Blue abandons Ansett terminal plans

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Fed: Virgin Blue abandons Ansett terminal plans

By Anthony Stavrinos

SYDNEY, Aug 14 AAP - Virgin Blue says it has abandoned plans to move into the formerAnsett terminal at Sydney Airport and instead will spend money improving the makeshiftpremises it is using now.

Virgin Blue said the airport's new owner Macquarie Bank wanted to charge too much forthe Ansett terminal.

It said it was not prepared to pass these costs on to travellers in the form of higherticket prices.

The budget airline has launched a public relations offensive on the issue featuringadvertisements that read: "Macquarie wants to increase our flight costs. What a bunchof bankers."

The airline's chief executive officer Brett Godfrey said Virgin Blue would remain operatingout of the small domestic express terminal and was willing to fund its expansion and upgrade.

"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.

Chris Corrigan, CEO of Patrick, which owns half of Virgin Blue, accused Macquarie Bankof trying to "extort ridiculous charges from the travelling public".

"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.

Virgin Blue claims that before the Macquarie purchase it had a deal with the airportmanagement to lease up to 40 per cent of the terminal for 15 years at $18 million a year.

But the Sydney Airports Corporation Ltd today said there was never a deal but its doorwas open to further negotiation.

A spokesman said Virgin Blue had been offered six branded gates and up to six unbrandedmulti-user gates in a five year lease and another five year option.

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

the spokesman said.

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."

He did not rule out considering a better offer from SACL.

Mr Godfrey called on Australian Competition and Consumer Commission chairman AllanFels to resolve the issue.

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

He said the commission was monitoring developments.

A Macquarie Bank spokesman was unavailable for comment.

AAP as/arb/tv/sb

KEYWORD: AIRPORT VIRGIN NIGHTLEAD (PICS AVAILABLE)