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“Many” regional and remote airports are owed more than $4 million by Rex, the Australian Airports Association has claimed.
The industry body argued the amount is a “significant sum” to its smaller members, who would likely only receive a fraction of the money should the carrier be eventually liquidated.
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Rex entered administration in July, halting its 737 capital city services but maintaining its regional connections serviced by its smaller aircraft. It’s currently thought to owe around $500 million to 4,800 creditors in total.
On Friday, the AAA released an analysis of data that showed Rex continues to carry around 75,000 passengers weekly, with 42 of its routes served exclusively by the carrier.
“Rex is still carrying tens of thousands of passengers to and from regional communities each week, allowing residents to visit loved ones and attend important medical or business appointments,” CEO Simon Westaway said.
“However, this new analysis from the AAA really highlights why the exit of Rex could be so significant for both its employees and customers.
“We welcome the announcement of $80 million in Federal Government funding to keep Rex flying to these communities, but we need to keep working together on a sustainable outcome.
“Many of our regional and remote airport members have detailed significant debts that total more than $4 million owed by Rex, a significant sum for smaller airports.
“We urge the Albanese Government to continue working collaboratively with airports to ensure that no communities are left stranded and regional connectivity is upheld.
“Air connectivity is a lifeline for regional communities and it is vital for governments and industry need to strive toward delivering better services and airfares for these residents.”
It comes after Australian Aviation reported this month how the federal government would give $80 million in financing to Rex, as administrator EY Australia similarly applied to the Federal Court to extend its voluntary administration all the way to 30 June 2025.
The move is another indication that the government does not want Rex to fail, having moved to prop up the ailing carrier by guaranteeing bookings and preserving its slots at Sydney Airport.
EY Australia, meanwhile, has been unable to find a buyer for Rex’s regional operations. However, it has sold its aeromedical division Pel-Air to Japan-owned Toll Aviation and is reportedly looking to sell Rex’s flight school in Wagga Wagga.
Administrator Sam Freeman said EY would use the financing and potential extension to embark on a business improvement program, including a fleet expansion.
“The extension we are requesting will help us to build a strong network for regional Australia, enabling us to continue to operate the regional network while undertaking a business improvement plan to reposition the business for sale,” he said.
“We’re planning to increase the size of the operational fleet while providing greater clarity for the Rex team and investing in strategic growth initiatives. Through this plan, we’re looking to increase reliability and capacity on the regional routes.
“An extension will not disrupt the continued operation of the regional network, which is such a critical part of regional and rural Australia’s connectivity. The actions to be undertaken in the extension period are expected to enhance the network.”
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says:The final three paragraphs above say it all! – most of us know that it won’t happen because unfortunately the enterprise has been left to rot and in its current form it’s only a matter of time before curfew. Govt. has the immense power to encourage another airline to start afresh with newer aircraft (which is the root cause of the problem) and the sooner that is achieved the better for the whole country; it’s fine to prop up the existing regime but there has to be a time limit because if there is no change, there will be no change.