REX calls in administrators after market share grab fail
Hundreds are set to lose their jobs as Australia’s third-largest airline heads into voluntary administration in what Cairns Airport CEO Richard Barker has called a “concerning and disappointing” development.
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Hundreds are set to lose their jobs as Australia’s third largest airline heads into voluntary administration in what the Cairns Airport CEO Richard Barker has called a “concerning and disappointing” development.
Regional Express, better known as REX, has fallen into insolvency and entered voluntary administration, grounding all of its Boeing 737 jets immediately.
The Transport Workers Union said more than 600 workers could be axed in what’s been described as a “dark day” for the industry.
Ernst and Young have been appointed as administrators after the company made an ill-fated attempt to compete with the big two of Qantas and Virgin with flights between Australian capitals.
Member for Leichhardt Warren Entsch said REX should “stick to what they are good at, serving our regional communities”.
“One of the things that concerned me is that they were trying to compete by taking over those city routes and that was always going to be a challenge.
“I’m glad to see they are doing an analysis on that now.
“Rex particularly in New South Wales is absolutely critical for regional services and we can’t afford to loose them but in going forward they need to focus in what they specialise in which is the regions.
“REX don’t have a huge footprint up here anymore, they used to fly up to Bamaga but we have been lucky that when they pulled out, we had Skytrans who have been an absolute champion for us.
“It reinforces the value of these small regional airlines, we have got to make sure these guys have space to operate as we would be buggered without them in our smaller communities.”
Senator Nita Green said she would like to see REX “stay in the regions”.
“I want to see them come out the other end of this process as a really strong regional airline that is servicing regional routes,” she said.
Mr Barker said regional connectivity was crucial to Australia’s aviation industry.
“The news of Rex Airlines entering voluntary administration is concerning and disappointing,” he said.
Following the news, the airline’s jet operations between major cities were immediately suspended.
Regional services flown by Saab 340s will continue for now.
“We have been informed by our partners at Rex that services from Cairns Airport are not likely to be impacted by this process, and that flights operating from here are expected to continue as normal.”
Ms Green said the news from REX was a really significant event for the region.
“We know REX services regions which are not serviced by other airlines and my thoughts are also with the workers who have found out their jobs may be on the line.
“Our government is working really closely with REX to work out what they need to stay in the air right now.”
Mr Entsch said he was confident that the solution will come for REX.
“But leave those big markets to the big guys, do what you do best and we will all be better off for it.”
Originally published as REX calls in administrators after market share grab fail
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