Virgin Australia Holdings (VAH) will decline to back a move by Sydney Airport (SYD) to brings its domestic and international operations under the same roof, unless all of its airline partners are included, The Australian Financial Review reports.
According to the newspaper, Sydney Airport flagged the idea of Virgin and one its partners operating out of the existing domestic precinct, however, Virgin expressed concern with the suggestion over a month ago.
The airline reportedly believes the plan would put it at a competitive disadvantage to Qantas and its partner Etihad, who would also be able to operate out of an existing domestic terminal.
Virgin's many codeshare partners include Air New Zealand, Delta Air Lines, Etihad Airways, Singapore Airlines, Virgin Atlantic and Virgin America.
Sydney Airport is currently under pressure to prove it can support increased passenger demand in the years ahead, as well as staving off the push for a second airport in Sydney.