Coronavirus: Rex airlines threatens to stop services amid pandemic

Australia’s biggest regional airline has shut down almost all of its flights as it begs for more government assistance during the coronavirus crisis.

Australia's biggest regional airline, Rex, has threatened to stop flying if it isn't given more support as it struggles in the wake of the coronavirus pandemic.

Regional Express Airlines said it would shut down passenger operations in all states except Queensland from April 6 unless “federal and state governments are willing to underwrite the losses”.

However, the airline will continue flying Ambulance Victoria services, charter flights for mining companies, freight services and pilot training.

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The threat comes a week after Rex halted trading in light of a massive downturn in demand for regional travel due to coronavirus.

Today's announcement comes after the Federal Government warned Australians against non-essential domestic travel and states effectively locked down borders.

Rex has announced it will stop passenger operations, except in Queensland, from April 6. Picture: AAP/Emma Brasier

Rex's deputy chairman John Sharp in a statement while the measures would help stem the spread of the virus, it was having a “tragic” impact on airlines.

“Tragically for the airline industry, this means that we can expect the year-on-year reduction of passenger numbers to nosedive to around 80 per cent from the 60 per cent we are experiencing today,” he said.

“There is a tipping point in the airline business beyond which it will no longer be sustainable to operate reduced services.

“We believe that with only 20 per cent of our passenger numbers left we have reached that point, and the Rex Group has decided that the quasi-suspension of all services at this stage presents the best option to preserve its cash.”

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Last week the Federal Government announced a $715 million rescue package for Australia's ailing airlines. Qantas and Virgin Australia have suspended their international operations and much of their domestic services, and Virgin Australia announced even more cuts to domestic flights today.

The regional airline is struggling with plunging numbers of travellers in the wake of travel restrictions and border shutdowns.

Mr Sharp said the rescue package would do little to keep Rex afloat and urged state governments to get behind regional air operators.

"The direct benefit to Rex from this package is only $1 million a month, which is grossly insufficient to cover the $10 million a month we expect to lose," he said.

“Regional air services provide an invaluable and priceless contribution to the socio-economic wellbeing of local communities throughout regional and remote Australia … So far the state governments have not tabled any concrete proposals, although their latest decisions of closing the borders and lockdowns will simply further decimate what remains of regional air travellers.

“If an assistance package of sufficient magnitude and viability can be negotiated by the end of the week, Rex may be able to reconsider its plans to suspend services.

“Failure to achieve any traction in this regard will see regional communities lose their air services for many months ahead and even after this is all over, we are afraid that some of the more marginal communities will no longer have an air service.”