Airlines Rex Airlines announces regional network strategy

After the largest airline in Australia, Qantas Airways, has established new routes in the regional market of the country, Rex now had to answer by announcing a new regional network strategy. Since Covid, Qantas had to compensate huge losses and has opened new routes in response.

The flag-carrier airline has started regional operations between Sydney and Orange, Merimbula and Griffith, between Melbourne and Merimbula, Albury, Wagga Wagga and Mount Gambier, as well as the route between Mount Gambier and Adelaide.

All of these routes have been operated by Rex beforehand and due to the flag-carrier´s aggressive price-management, only a fraction of the passengers on these routes choose Rex. As result, Rex will now cancel five routes.

Rex’s Deputy Chairman, the Hon John Sharp AM, stated: “Qantas has clearly embarked on a  deliberate strategy of moving into Rex’s routes that can only support one regional carrier in an attempt to intimidate and damage Rex in its traditional regional market, hoping that Rex would be a less formidable competitor in the domestic market.”

The regional carrier will end services between Sydney and Bathurst, Cooma, Lismore and Grafton and the route between Adelaide and Kangaroo Island. On the routes, where Qantas has moved in, Rex decided to stay in the market to stand its ground.

As result, it is expected that both carriers will be making significant losses. But the regional airline will also be opening new routes from Sydney to Coffs Harbour and Port Macquaire, as Virgin Australia has retreated its operations there.

Rex also released, that it has filed complaints to the Australian Competition and Consumer Commission regarding Qatar´s predatory behaviour. "In this environment, the introduction of new competing services in fragile regional routes should be set aside by the ACCC until we return to a semblance of normality," the airline argued.

Rex was founded in 2002 and currently has its headquarters at Mascot, New South Wales in Australia. The regional carrier employed over 1000 people as of last year and has operational hubs across the country.

The fleet consists of 60 Saab 340 aircraft, of which eight have left the fleet. Also, four Boeing 737-800s have joined the fleet since late 2020. Two more aircraft are expected to be delivered this month.