If you are arriving in Sydney around 8am (or 8pm), don’t count on getting anywhere on time.
That’s when the large international flights all show up at once and queues get pretty bad – last time I went through at peak time, even the express line at immigration was well over an hour.
As Doc mentioned, Smartgate can help if the machines happen to like your passport and you aren’t traveling with kids or otherwise disqualified. However, the overall speedup was temporary – the automated lanes get backed up too, and recently they seem to have gotten rid of most of the manual lanes.
I’d go with the 6 hour delay – once you do make it through customs, it only takes about twenty minutes to get into the city by train.
Sydney airport is unfortunately one of the worst airports in the world for International -> Domestic transfers (and it’s even worse in the other direction!).
Terminal 1 (International), and terminals 2/3 (Domestic) are not connected in any way, and are several kilometres apart.
The good news is that recent changes to immigration in Australia – in particular allowing passengers from many countries to use the “Smartgate” automated immigration machines. Even if you’re not from one of those countries, the time to get through immigration has been reduced due to them having to manually process fewer people.
The bad news is that once you go through immigration, you need to collect your bags, go through customs (which can also have a delay), and then, somehow, get to the domestic terminal.
If your domestic flight is on either Qantas (NOT including Jetstar flights, even if sold with a Qantas flight number) or Virgin Australia then this is a relatively simply process. Both of these airlines have check-in counters for domestic flights at the international terminal, and both run free buses to the domestic terminal. In both cases, you can use these services regardless of what airline you arrived on – it’s just your outgoing flight that matters.
Qantas is a little faster here as you pass through security in the international terminal, the bus runs through the airport, and you arrive airside in the Qantas terminal, whereas the Virgin bus runs landside and thus can be delayed by traffic, and you arrive landside and have to pass through security in the domestic terminal.
Both of these transfer areas are also very good at handing delayed passengers, and will frequently move you to a later flight at no charge if you’ve missed (or are likely to miss) your original flight – even if they are not responsible for the delay.
If you are flying another airline (eg, Jetstar, Tiger), then you will need to get yourself and your bags to the dometsic terminal, either via public bus, public train, or a taxi. It’s not fun, and I don’t recommend it.
Time-wise, presuming the outbound flight is with Qantas or Virgin then 2h15 should be fine, but if it was me I would probably recommend going with the 2h45 option just to be safe.
If you are looking at flying with another airline, I would not at all recommend the 2h15 option, and even the 2h45 could be tight depending on things like exactly what time of day you arrive, and how busy the check-in area at the domestic terminal is at the time. Jetstar and Tiger also have very strict check-in/bag drop times, and if you miss it then you’ve lost your ticket!
It’s also a good idea when travelling with multiple tickets like this to have travel insurance. As long as you’ve over the minimum connection time for the airport (which you are), then travel insurance will normally cover any costs with re-routing if you are delayed and miss the connecting flight.
This question from 2014 tackles the same question
https://www.lonelyplanet.com/thorntree/forums/australasia-pacific-australia-new-zealand-antarctica/australia/sydney-airport-connection-time
The conclusion is that 2.45 will probably be okay but doesn’t have a lot of margin.
This from 2011 recommends 2.5h http://www.australianfrequentflyer.com.au/community/your-questions/minimum-connection-time-sydney-28987.html
Transfer between terminals is a bit of chore and you need to pay for it: http://www.sydneyairport.com.au/go/terminal-transfer.aspx.
Having an electronic Visa and a machine readable passport would help with immigration procedures.
“Safe” is a matter of opinion. A flight can always be delayed, diverted or cancelled: even with your six hour gap it’s not an unrealistic prospect that you miss the domestic flight.
It’s a risk measure. Your question should be informed by another question, “if you miss your domestic flight, what will you do?” If it’s no problem, then go for the shorter connection. If it is a serious problem for you, then you should allow more time, perhaps an overnight (or book on the same ticket!).
Personally, I would go for the six hour gap here, and if I arrived early or on time, I’d go into Sydney for an hour or two.
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