If... Rex manage to pull this off, the $150 million investment should give quite a nice return to the HKG fund.
Think about the end result:
- regional ops with $300+ million in revenue
- domestic jet ops $5-600 million in revenue
- even with a 5% profit margin that’s around $40-$50 million in profit per year.
Plus the cashflow from jet ops should help Rex get funding to replace the Saab fleet when the time comes. Also having connections (via jets) may help them win some extra passengers on the regional network.
I know there’s a lot of naysayers on this site, but I think Rex have a good chance of pulling this off. The one major thing going for them is the ability to control costs. Whatever you think of management, this is one key skill in any airline. Without it, airlines fail. Something our friends at VA are learning about now...