Originally Posted by
MickG0105
So more demand than two full 340s/Q200s each day, seven days a week and that route is only 'likely mildly profitable'? Rex only fly that route 5 days a week. If they're not hauling in cash off that route they need a new revenue management system.
So this is always the bit of the Rex argument that's always interesting. Apparently monopoly routes are bad ... unless it's Rex that has the monopoly.
I don't have a problem with Rex per se, but I do have a problem with poor and hypocritical arguments.
Ok I’ll help.
77 passengers each way every day of the week.
Rex (Pre Covid) ran 3-4 services a day to Sydney. Fly Corporate ran limited services to MEL/BNE.
77 x 2 = 154 pax
154 x 7 = 1078 per week
minus fly corporate (say 15-20 per flight x 4 sectors) = 1010
Across 6-8 individual Rex sectors daily: 1010/48 sectors = 21 pax average per sector on Rex
34 seat Saab, 21 pax = 61% load factor. I think their average across the whole network is the high 50’s, so hardly ‘profit gouging’.
If QF want to offer a reasonable schedule, they’ll have to go 2x daily Monday to Friday. That’s an extra 20 sectors a week.
Lets assume the market grows by 20%. 1010 pax becomes 1200/week. Divide that by 68 sectors and now you get 17 pax per sector. If it doesn’t grow now we’re looking at 14 pax per sector.
So like I said both companies wear a loss until one pulls out. Back to monopoly.
I never (and I don’t think Rex have either) have said that they don’t want competition. But SOME regional routes WILL NOT SUPPORT competition in the sense of two viable companies. There is simply not enough demand to support two efficient companies. That’s why until recently most of the states restricted competition (yes a monopoly) to the smaller towns.
By all means expose Rex to competition, after all that’s the point of a capitalist economy. But don’t try and tell me this won’t result in the SYD-OAG route going back to a monopoly when one carrier pulls out. That’s the point I’m making.