The M1 Princes Motorway is part of the National Land Transport Network and is the only crossing of the Illawarra Escarpment suitable for High Productivity Vehicles (HPVs). It is also an important connection between Wollongong and the broader state highway network.  

The section through Mount Ousley is a key corridor for movement of freight between the Illawarra region, Greater Metropolitan Sydney via the Princes and Hume Highways (via Picton Road), and southern Sydney industrial precincts such as Moorebank Intermodal Terminal. The corridor is a major connector between Port Kembla, which is the primary NSW port for car imports, and the rest of the state. 

The 5km section of the motorway at Mount Ousley is currently subject to heavy traffic congestion and poor Levels of Service, particularly during weekday peak periods and during weekend/holiday peaks. This is due to the capacity of the road, the steep and winding road geometry, potential landslides causing road closures and a reduced speed limit to manage safety. Travel time delays, safety incidents and network resilience impacts are expected to increase as traffic demand, particularly by freight vehicles, continues to grow.  The proposal is related to Mount Ousley Interchange capacity which was listed on the Priority List in February 2021 and fully funded in Budget 2021-22.