Thursday 4 March 2021

REX Regional Express Airlines walks away from its Clarence Valley airline route for a second time, yet again trying to blame others for its decision



Rex will stand by all regional communities that have stood by Rex during this global and national crisis” [Rex Express Holdings Deputy Chairman and former Nationals MP for Hume, the Hon John Sharp AM, company media release, 29 April 2020]


Stirring words in that quote at the top of this post, however the reality was somewhat different for two regional communities on the NSW North Coast - Clarence Valley and Lismore City.


Lismore Airport services a city and population on the banks of the Wilsons River and is a gateway for both business travel and holidaymakers.


While Grafton Airport in the Clarence Valley is predominately used by state authorities and local government.


Having received financial assistance from Clarence Valley Council as well as nearly $24 million from the federal government’s $198 million Regional Airline Network Support Program (RANS), $53.9 million from the $100 million COVID-19 Regional Airlines Funding Assistance Program (RAFA), Jobkeeper workforce wage subsidies, and  unspecified funding through Australian Airline Financial Relief Package (AAFRP), Regional Express Airlines (REX) suddenly decided to cease flights into Grafton Airport on 3 July 2020.


Apparently it had decided it wished to expand its presence on other routes where it could compete with a pandemic-weakened Qantas Airlines.


It reversed its decision to abandon Grafton Airport in August 2020 – promising to operate return services three days a week, on Monday, Wednesday and Friday on a Sydney-Grafton Lismore route commencing 17 August 2020


Coincidentally REX's re-entry followed on the heels of negative publicity and media reports that Clarence Valley Council had begun looking for another airline to take its place.


Now seven months after its return, the predominately foreign-owned REX is withdrawing from its Sydney-Grafton-Lismore route as of 23 March 2021.


This time all but admitting that having milked the federal government for as much funding as it could, it was again abandoning both Grafton and Lismore just days ahead of the cessation of the emergency regional airline funding streams it had previously accessed.


In a media release dated 22 February 2021 REX stated:


Rex will, from April, commence new services to ports where Virgin Australia has retreated, leaving Qantas as the sole or dominant operator. The new services are from Sydney to:

Coffs Harbour (330,000 passengers pre-COVID)

Port Macquarie (190,000 passengers pre-COVID)

and will be available for sale from tomorrow.”


Other routes under active consideration where Qantas is the sole or dominant carrier include:

Sydney - Tamworth (175,000 passengers pre-COVID),

Perth - Geraldton (110,000 passengers pre-COVID),

Melbourne - Devonport (146,000 passengers pre-COVID), and

Sydney - Canberra (930,000 passengers pre-COVID).”


We will be launching services to these cities once a partnership agreement is concluded with the local councils or airport owners.”


Our plans to commence domestic jet services on the Sydney-Melbourne route on 1 March are still firm barring further border closures.”


In another media release dated 1 March 2021 REX stated:


Adelaide and the Gold Coast as they have been chosen by Rex to receive domestic jet services just in time for the Easter rush.


Rex today announces that it will commence new services between Melbourne and Adelaide from 31 March, whilst the Gold Coast will receive services from Melbourne commencing 29 March and from Sydney commencing 1 April 2021…..


I wish to thank both Adelaide Airport and the Gold Coast Airport who have worked tirelessly with us to make this happen in such a short time frame.”


One has to wonder how long the honeymoon will last for Coffs Harbour, Port Macquarie and Gold Coast airports and, whether airport managements realise just how many times REX will seek financial concessions from local government to keep flying these routes.


In the Clarence Valley the honeymoon is long over and personally I'm hoping we have finally seen the last of REX.


BACKGROUND


According to Regional Express Airline’s 2019-20 Annual Report its largest shareholders are:


MR KIM HAI LIM with18,998,346 fully paid ordinary shares – 17.25% of total shares issued

BNP PARIBAS NOMINEES PTY LTD with 16,234,094 fully paid ordinary shares – 14.74% of total shares issued

THIAN SOO LEE with 7,722,181 fully paid ordinary shares – 7.01% of total shares issued

JOO CHYE CHUA with 7,454,362 fully paid ordinary shares – 6.77% of total shares issued

MING YEW SEE TOH & HUI ING TJOA with 7,454,362 fully paid ordinary shares – 6.77% of total shares issued

MS HUI LING TJOA with 5,755,513 fully paid ordinary shares – 5.22% of total shares issues.


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