Australian flag carrier Qantas and Perth Airport have reached a commercial agreement which will unlock a significant new wave of investment and deliver new international and domestic flights.

As part of the 12-year agreement, Perth Airport will invest around A$3 billion in new terminal facilities and a new parallel runway.

This will form part of a A$5 billion capital investment program by the airport – the largest ever private infrastructure development in Perth – which will also deliver two multi-storey carparks, major access roadworks, and the airport’s first hotel.

Qantas and its low-cost carrier Jetstar will relocate all services to a new terminal in the ‘Airport Central’ precinct that will enable the growth required to turn Western Australia into a major domestic and international hub for the airlines.

Qantas and Jetstar plan to add 4.4 million seats to and from Perth per annum by the time the new terminal opens in 2031.

They say that the Perth hub will significantly enhance inbound tourism and give Australians more options when travelling to Asia, Africa, India and Europe.

The new terminal is set to offer seamless domestic and international transfers.

Qantas says it will work with Perth Airport on plans for a multi-lounge precinct for international and domestic passengers with a new signature design and bespoke dining and wellness initiatives.

The airport will also invest in upgrades to Terminals 3 and 4, the current home of Qantas domestic and international flights, to create additional capacity while the new terminals are built.

Jetstar will relocate its domestic services to Terminal 2 from September 2024, before moving into the ‘Airport Central’ terminal when complete.

The airline and airport note that the Terminal 3 and 4 upgrades will enable Qantas to add services and more destinations from Perth, including Auckland and Johannesburg from mid-2025.

The works will also include gate upgrades to accommodate ultra-long-haul aircraft, including Qantas’ ‘Project Sunrise’ Airbus A350-1000s which arrive from 2026.

This week’s agreement resolves all outstanding commercial issues in dispute between Perth Airport and oneworld carrier Qantas.