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Rex survival is critical

The Australian Travel Industry Association (ATIA) supports the idea that the Federal Government should be the buyer-of-last-resort for Regional Express Holdings (Rex), given the first option should always be for a private buyer.
 
With around $11.5 million in outstanding payments owed to travel agents, predominantly in regional and rural Australia, ATIA is also asking the Government to ensure that any public funds used to support Rex’s ongoing operation use a clawback mechanism for these outstanding debts over a 12-month period.
 
The Government today confirmed additional support will be provided to help maximise the prospect of a successful sale, including a waiver of the “use it or lose it” test for Rex regional flight slots at Sydney Airport, which will ensure access until 24 October 2026. The Government has also announced that in the event there is no sale, the Government “will undertake necessary work, in consultation with relevant state governments, on contingency options, including preparations necessary for potential Commonwealth acquisition.”
 
Today’s announcement is in addition to the Government lending up to $80 million to keep Rex’s regional routes operational until 30 June 2025 and acquiring $50 million of debt from Rex’s largest creditor, PAGAC Regulus Holdings Limited, earlier this year to ensure the airline could continue to operate.
 
ATIA continues to work closely with the Government to ensure the needs of the Travel Sector are considered throughout the process.

QUOTES ATTRIBUTABLE TO ATIA CEO DEAN LONG:
“There’s no doubt that the ideal solution will always be a private buyer. If the Government does buy Rex, they must make good on the money owed to Australian travel agents and airports as a result of Rex’s collapse.”
 
“Around $11.5 million is currently owed to Australian travel agents who are predominantly small-business owners in regional and rural Australia. Like these agents, there are also a number of airports that have significant losses due to the collapse of Rex. Any buyout of that debt or nationalisation of the airline must see these debts repaid as a priority. This can’t just be about sending money to international creditors.”
 
“Government gave over $5 billion to airlines during COVID, yet despite that, we’ve ended up with higher airfares. Australia has the most concentrated aviation market in the world. We also have to acknowledge that a number of the routes Rex operates are actually mandated monopolies, so we need a robust third airline business in Australia. ATIA has asked, including in our pre-budget submission, that the Australian Competition and Consumer Commission be empowered and funded to undertake an annual market concentration study of international and domestic services and funded to continue its Domestic Airline Competition Monitoring reports beyond 2026.”
 
“The major issue for Rex is the age of the fleet, and this will be a major barrier for any buyer as there is a global shortage of aircraft. If we allow Rex to collapse, it’s going to lead to even higher prices for regional communities but, critically, also a huge loss of connectivity, which will have a significant impact on their economies.”

For media enquiries, please contact LJ Loch at lj.loch@atia.travel or 0488 038 555