ATIA Advocates for Federal Support of Rex Airlines in Acquisition Efforts
The ATIA suggests that the Federal Government should act as a fallback buyer for Rex Airlines, with private buyers having the initial opportunity.
The Australian Travel Industry Association (ATIA) supports the proposal for the Federal Government to serve as the buyer-of-last-resort for Regional Express Holdings (Rex), noting that the first opportunity for purchasing should be extended to private buyers.
According to ATIA chief executive 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.”
(Translation: Long emphasized the priority of private buyers in any acquisition scenario.)
Currently, Rex owes approximately $11.5 million to travel agents, primarily in regional and rural Australia. The ATIA has urged the Government to implement mechanisms to recover these debts over the next year if public funds are utilized to assist Rex’s operations.
Long also highlighted concerns about Rex’s aging fleet, indicating this could deter potential buyers amidst a global aircraft shortage. He warned that allowing Rex to fail could exacerbate price increases for regional communities and result in significant loss of connectivity, adversely impacting their economies.
Federal Support Confirmation
As of February 12, the Government has committed to providing additional support to enhance the likelihood of a successful sale. This includes easing the “use it or lose it” test for Rex’s regional flight slots at Sydney Airport, securing accessibility until October 24, 2026. Moreover, the Government plans to work with state governments on contingency plans should a sale fail, including preparations for possible Commonwealth acquisition.
This announcement serves as an addendum to the Government’s earlier decision to extend up to $80 million in loans to keep Rex’s regional routes operational until June 30, 2025, alongside the acquisition of $50 million of debt owed by Rex’s largest creditor, PAGAC Regulus Holdings Limited, to sustain the airline’s operational capabilities.
The ATIA pledges to maintain close collaboration with the Government to ensure the travel sector’s requirements are adequately addressed throughout this process.
