Daily Telegraph
Up, up and away with Rex
10sep02
FLEDGLING regional airline Rex has confirmed talks over an "interline" agreement with Singapore Airlines, fuelling speculation about the Asian carrier's interest in entering the Australian domestic market.
The deal, if it goes through, will allow Singapore Airlines passengers landing at any of the five Australian cities to go on to 31 other destinations in the country without having to check in their bags again or make separate bookings.
Discussion over the agreement with Singapore Airlines began about a fortnight ago, Armon Hicks, a spokesman told Singapore's Straits Times.
Rex -- short for Regional Express -- is also in talks with both Qantas and Virgin Blue.
If the deal does go ahead, it will be a major coup for Rex which began its first services last month after being resurrected from the ashes of Hazelton and Kendell airlines.
Rex already has a Singapore connection, being financed by Singaporean businessmen Lim Kim Hai and Lee Thian.
A Singapore Airlines spokesman treated the latest talk of an Australian venture the same as recent market rumours, saying the airline will "rule nothing in or out".
"We are leaving our options open with regards to the Australian domestic market," the spokesman said.
Among various rumours has been a suggestion that Singapore Airlines was considering a proposal to revive Australia's collapsed Ansett airline.
Ansett provided a feeder service for Singapore Airlines passengers before its sensational collapse last year.
Since Ansett's demise, the Star Alliance group of airlines, including Singapore Airlines, has lacked a presence in the domestic market.
Analysts estimate this is costing the Singapore operation hundreds of millions of dollars a year.
Aviation analysts say that even if Singapore Airlines seals an agreement with Rex it would not fill the vacuum left by Ansett, as Rex has only 2 per cent of the market and does not fly key routes such as Melbourne-Sydney.
In other airline news, Qantas' sagging share price has thrown its $200 million retail capital raising into doubt.
Having raised $600 million from institutions just two weeks ago, Qantas yesterday opened the retail component to smaller investors.