Pushback Over Australian Plan to Buy Rex Airlines
The Regional Aviation Association of Australia (RAAA) is urging the Australian government to reconsider its proposal to purchase Rex Airlines if no private buyer emerges. The government’s plan to nationalize the struggling regional carrier has sparked opposition from industry stakeholders, who warn of potential market disruptions.
RAAA CEO Rob Walker highlighted concerns about government intervention, stating that many of their member airlines already compete with Rex on 21 of its 46 routes. Sharp Airlines, a direct competitor, echoed these concerns, stressing that a government-owned airline could undermine fair competition.
Michael McConachy, managing director of Nexus Airlines, suggested that existing carriers could step in if Rex ceases operations. He emphasized that his airline, which operates DHC-8-Q400s, is prepared to take over Rex’s four regulated routes in Western Australia with minimal impact on pricing or service continuity.
Despite the sale of some Rex business units, administrators Ernst & Young have yet to find a buyer for the core turboprop operations. A second sales campaign is set to launch soon, though Walker remains skeptical about a successful outcome.
The RAAA is advocating for “industry-led solutions” and has secured a meeting with transport ministry officials to discuss alternatives. Walker stressed the importance of maintaining a level playing field, warning that a government-owned Rex could unfairly disadvantage private carriers.
The government, facing political pressure to maintain air services to remote communities, must now weigh the potential risks of its intervention against the industry’s call for competitive fairness.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com