Coastal councils remain confident in future of Rex despite business turbulence

Two South Coast councils are confident in Rex’s future even though the regional airline has grounded part of its fleet.

The airline announced on Tuesday (30 July) that Regional Express Holdings Limited and a number of its subsidiaries were going into voluntary administration, with EY Australia appointed as administrators.

While its domestic routes between major cities – which use Boeing 737s – have been cancelled, the regional airline has confirmed its Saab 340 flights are set to continue in its regional routes.

Regional services in NSW flown by Rex include flights to Wagga Wagga, Moruya and Merimbula. It also has an extensive network throughout regional Queensland, northern Tasmania, regional South Australia and southwest Western Australia.

A Melbourne to Canberra route is among those cancelled.

The announcement follows the Australian Securities Exchange (ASX) announcing on Monday (29 July) that trading in Rex shares were suspended for 48 hours at the airline’s request.

A Eurobodalla Shire Council spokesperson said council was confident the shire’s Moruya Airport, which is serviced only by Rex, would remain viable.

“Rex Airlines flights to Moruya remain unchanged and are operating as usual. Eurobodalla Council recognises this service is vital to our community for business, family connections and medical services, and continues to advocate for and support its provision,” the spokesperson said.

“The administrator has said regional flights will continue during the administration period, although customers with onward capital-city Rex connections have received texts advising cancellation of those flights.

“Rex has previously indicated its desire to increase services to Moruya, showing a confidence in the route and its profitability. It’s more important than ever we support the Moruya service so any review and restructure show the route remains a profitable one.”

Rex operates regular flights to Sydney and Merimbula from Moruya Airport, with passenger numbers climbing to more than 20,000 after a COVID-19 dip.

Merimbula Airport is serviced by both Rex and Qantas, which offer services to Sydney and Melbourne.

Bega Valley Shire Council CEO Anthony McMahon said the council was optimistic the regional airline could hold its place in the region’s travel industry.

“While changes to the group’s domestic Boeing 737 service between major cities have been made, the administrators have confirmed the continued operation of its regional Saab 340 fleet with the ongoing support of key stakeholders.

“For Merimbula airport customers, this means business as usual.

“We remain hopeful the appointed administrators will successfully work with the Rex Group to ensure ongoing operations in regional airports.”

A total of 610 jobs will be axed, including a forecast 250 jobs from across the regional arm of the business, according to the Transport Workers Union (TWU).

TWU National Secretary Michael Kaine said the regional airline’s situation would hit employees hard.

“This is another dark day for aviation, with over 600 families faced with sudden joblessness in an industry that has taken hit after hit,” he said.

“We are working to secure job opportunities at other airlines and aviation companies for ground crew, cabin crew and pilots, and have had positive conversations with Virgin Australia and ground handler Dnata.”

Impacted customers with tickets for cancelled Rex flights can rebook with Virgin Australia for free by contacting Virgin Australia before 5 pm AEST on 14 August.