Rex flights crash to a standstill in Qld as coronavirus kills cash flow

Rex grounds all Qld flights after govt funding fails to take off

Agribusiness
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Regional Express grounds all its regular public transport services indefinitely in Queensland from April 1.

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Just two days after confirming it was keeping its planes flying, thanks to a federal government country airline rescue package, Regional Express is now stopping all public flights in Queensland because the state government won't help out.

Rex will ground its Queensland regular public transport services tomorrow (April 1), indefinitely.

The big country carrier said it did not have the passenger patronage or alternative funds to keep operating between Brisbane and the 25 regional airports it normally flies to across the state.

The shutdown includes the five regulated routes operated under a long-term contract with the Queensland government.

The overnight decision to ground its Queensland fleet will impact remote communities such as Bedourie, Birdsville, Quilpie and Julia Creek, plus a host of other outback and major coastal centres from Cunnamulla and Charleville to Mount Isa, Cairns, Townsville and Toowoomba.

Rex has no choice but to declare a force majeure event for the government contract and suspend all services on Queensland regulated routes indefinitely - Regional Express statement

A statement from Rex management said while the federal government had just announced several assistance packages for airlines, federal funding would only cover a minimum essential service of one return weekly flight per route.

This reduced schedule approach was rejected by the Queensland state government.

At the same time no concrete details of the federal funding were yet available from Canberra and "not a single cent has been disbursed".

Rex, Australia's largest independent regional airline, said it first requested consideration of funding support from the Queensland government on March 19 and had made numerous further appeals.

In the meantime, Rex's financial position and cash flow had sharply deteriorated, particularly after Queensland state borders closed to regular visitor traffic last week as part of the coronavirus health emergency.

On March 6 Rex was carrying five per cent more passengers than at the same time last year, but by March 29 bookings had crashed to near 5pc of the numbers handled a year ago.

The spectacular freefall in patronage was blamed on public movements being limited to essential travel only, as well as the border control measures implemented across Australia.

"With cash fast running out and no immediate prospect of a workable solution from the Queensland State Government, Rex has no choice but to declare a force majeure event for the government contract and suspend all services on Queensland regulated routes indefinitely until it has the ability to service the contract in a commercially viable manner," the airline announced.

Queensland's Transport and Main Roads division was being notified officially today.

Rex said affected passengers would have tickets placed on credit for when services resume.

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Rex said affected passengers would have tickets placed on credit for when services resume.

The shutdown only applies in Queensland and will not impact the company's private charter business.

Services on the remainder of Rex's national network would continue in accordance with the

conditions the airline had agreed to at the weekend, with Rex scaling back such services to the level covered by the federal government assistance package.

The Queensland airports where Rex has suspended services are:

  • Bamaga NPA
  • Bedourie
  • Birdsville
  • Boulia
  • Brisbane
  • Burketown
  • Cairns
  • Charleville
  • Cunnamulla
  • Doomadgee
  • Hughenden
  • Julia Creek
  • Karumba
  • Longreach
  • Mount Isa
  • Mornington Island
  • Normanton
  • Quilpie
  • Richmond
  • St George
  • Thargomindah
  • Toowoomba (Wellcamp)
  • Townsville
  • Windorah
  • Winton
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The story Rex flights crash to a standstill in Qld as coronavirus kills cash flow first appeared on Farm Online.

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