Wednesday, 17 June 2020

REX Regional Express Airline ditched its promise to keep flying into Grafton Airport during the COVID-19 pandemic because it wanted to fight a trade war with Qantas at other airports & didn't want to waste its few dollars on the Clarence Valley. However, Clarence Valley Council is about to tear itself apart rather than face that truth.

REX Regional Express airline has previously admitted that due to the impact of the COVID-19 pandemic it was on the verge of bankruptcy in March 2020, that keeping all air routes open would create a potential financial loss in the vicinity of $10 million a month and, that its current focus (after receiving est. $53.8 million in an untied federal government grant) was on pursuing a trade war with Qantas in which it was putting on extra non-profitable flights into certain airports where it will openly compete with the larger airline.

Rex's skeleton air service into Grafton Airport was always going to be a casualty of the airline board's current grandiose plans.

Even S&P Dow Jones Indices' removal of Rex from the S&P/ASX Index All Ordinaries list effective 22 June 2020 recognised the less than stellar financial outlook for this company.

However, Clarence Valley Council cannot see past the 'fig leaf' excuse Regional Express Holdings gave for terminating what it has previously deemed unprofitable flights into the Clarence Valley from 3 July 2020.

Instead Council will play out the old political animosities held by a clique of male wannabees who never made it past local government.

The Daily Examiner, 16 June 2020, p. 1:

A threat of legal action by a Clarence Valley councillor has led to the cancellation of an extraordinary council meeting in Grafton this afternoon. 

Clarence Valley Mayor Jim Simmons said a decision to cancel the meeting was made on receipt of a letter from solicitors representing Cr Debrah Novak. 

The meeting had been called to demand Cr Novak apologise to regional air carrier REX Airlines for comments she made about the airline during last month’s council meeting. 

Cr Novak said Rex management needed to “pull its finger out”. 

On June 4 the council received correspondence from REX saying that despite council waiving 100 per cent of the head tax it collected from the airline, it would cease to operate its Grafton service from July 3. It cited “hostility” from councillors as its reason for cutting the service. 

Cr Simmons said the letter called for an injunction against holding the meeting because the matter should have been dealt with during the May meeting and not have been brought up at a separate meeting. 

The mayor said he had a similar misgiving and had contacted the NSW Office of Local Government for advice. 

“I expect I’ll get that advice tomorrow morning,” Cr Simmons said. 

But he said Cr Novak was not off the hook and the matter would most likely appear as a report from general manager Ashley Lindsay at next week’s council meeting. 

“It might have to be in a different format, but there are still issues here the council must deal with,” he said. 

Meanwhile business groups have expressed their dismay at REX’s decision and Cr Novak’s role in it......

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