REX to transition to ATRs, start domestic jet ops

[MickG0105]

Mick, when does the cash run out? Assuming they continue to burn 50-60m per year.

The fairytale will only go as far as the money pot will let it.
It's a bit hard to say. They have $30 million left in the PAGgybank. Here though it is worth noting that after drawing down $30 million in H1FY24, their net cashflow was only +$5.3 million. Suffice to say, they are running out of runway and still not airborne.

At least one of the important numbers is buried in the notes, namely the segment results. RPT (domestic jet and regional) clocked a $25.1 million loss on revenue of $315.8 million. That means that for every dollar of revenue they booked for RPT, they spent $1.08. Dress that up any way you like and it is a problem.

But hey, what do I know? Apparently there's a school of thought that if you don't talk about it then it's not really a problem.

https://cimg6.ibsrv.net/gimg/pprune.org-vbulletin/1907x571/screenshot_20240229_165120_adobe_acrobat_b36876af04d01f997b6 97a982dc66e675c1f2702.jpg

[SHVC]

Rex out blaming everyone else again for their demise. Jimmy just can’t help himself.

“Due to relentless poaching of Rex’s pilot group by other airline carriers, on 22 September 2023, Rex announced that the airline was forced to
make further reductions to its regional network.”

[Ladloy]

Rex out blaming everyone else again for their demise. Jimmy just can’t help himself.

“Due to relentless poaching of Rex’s pilot group by other airline carriers, on 22 September 2023, Rex announced that the airline was forced to
make further reductions to its regional network.”
Someone needs to send a dictionary to Baxter Road

[neville_nobody]

Yep. Astounding that people running a ASX listed company don't have a basic grip on the English language nor economics. However what it does show is that the standard of Business journalism in this country is terrible. They love to write a headline about gender imbalance or how work form home is more efficient (apparently), yet when a ASX company is out there basically denying fundamental economic theory they are silent. The REX chairman had a long form article written about him last year in the AFR and the only criticism that the author could make was about gender imbalance in the board and paint him as a bit of a old fashioned chauvinist.

Any economist in the world will tell you that the resaon is there is a Labour Supply problem at REX is because they don't pay enough. Up the salary and the problem will fix it self. It is very simple. Adam Smith wasn't an idiot. However these people who seem to be all "free market" are really not that at all. It is very telling that when the market works against them or their ideology they suddenly want the government to do something about it.

Now if you can't afford to pay more then either you have to get creative (country basings anyone?) or your fundamental business model is flawed. If your entire business is built around under paying pilots whose license these days is worth over $150K then they have a big problem. Maybe REX will be the first to show us what a real pilot shortage will do your business and unlike the US Regionals there is no Chapter 11 Bankruptcy to hide behind.

[MickG0105]

I suspect that pilot numbers is amongst the lesser of their worries.

Crewing issues notwithstanding they managed to increase capacity by around 13.7 percent. Bums on seats increased by less than half a percent (that's the number of bums, not the size thereof). Rex's core business was losing just shy of $136,500 a day on low 70s load factors for the six months to 31 December 2023. If they're still planning on bringing on more capacity over the next few months they need to do something quickly about pax numbers/revenue.

I'll go back to what I was saying in a different thread about how you can tell whether your marketing is working or not; if it is not translating into pax numbers, and the transfer of cash from said pax to your coffers, then it is not working, no matter how "good" it looks or sounds.

Separately, while it is at the edges, you do have to wonder as to the mechanics of losing $2 million on $4.2 million worth of training revenue. Rex's FY23 results presentation talked up the "Influx of foreign cadets at the pilot academies" as a positive for FY24; that certainly did not play out over the first half.

[CaptainInsaneO]

Hopefully they can pull in another $100m from somewhere to keep the show going

[Traffic_Is_Er_Was]

Who writes Rex's media releases? That whole thing reads like it should have been in quotation marks.ie a rant from a member of management, rather than a statement to the public/industry interspersed with a couple of quotes. Did they have an essay writing competition down at the local high school, or does someone at Rex Corp Relations not know where quotation marks start and finish?

[1A_Please]

REX's investor presentation is amazingly amateurish It looks like it was put together by someone who was using PowerPoint for the first time.

Their performance is disastrous. YoY, they increased from 7 to 9 737s (a 28% increase) but only managed to increase RPT revenues by 6% which has led to the $25M loss in RPT services as highlighted by Mick. In addition, their cheap as chips lease deals they got their first 737s are now all expiring and they are being forced to pay market rates, which, for a small tenuous operation like REX, will be more than lessors will agree to with the bigger more secure operators.

[Ladloy]

Hopefully they can pull in another $100m from somewhere to keep the show going
The Nationals aren't in power so I'm not sure where it's going to come from.

[Deano969]

REX's investor presentation is amazingly amateurish It looks like it was put together by someone who was using PowerPoint for the first time.

Their performance is disastrous. YoY, they increased from 7 to 9 737s (a 28% increase) but only managed to increase RPT revenues by 6% which has led to the $25M loss in RPT services as highlighted by Mick. In addition, their cheap as chips lease deals they got their first 737s are now all expiring and they are being forced to pay market rates, which, for a small tenuous operation like REX, will be more than lessors will agree to with the bigger more secure operators.
Are you forgetting that they cut back a lot of SAAB flying as well which explains just a small increase in RPT revenues

[1A_Please]

Are you forgetting that they cut back a lot of SAAB flying as well which explains just a small increase in RPT revenues
You need to park a lot of Saabs to cover for the capacity of 2 738s. Their results are truly terrible. At some point PAG has to decide if it is going to put in good money after bad or just let the whole thing collapse.

[DanV2]

RQG is set to be returned to lessor. Reportedly the 2 jets are coming from SQ (originally Silkair). The bulk of ZL's 737 fleet when those are delivered are set to be dominated by ex-SQ and ex-VA frames with the two odd-balls from GOL and Jet.

[dejapoo]

REX's investor presentation is amazingly amateurish It looks like it was put together by someone who was using PowerPoint for the first time.

Their performance is disastrous. YoY, they increased from 7 to 9 737s (a 28% increase) but only managed to increase RPT revenues by 6% which has led to the $25M loss in RPT services as highlighted by Mick. In addition, their cheap as chips lease deals they got their first 737s are now all expiring and they are being forced to pay market rates, which, for a small tenuous operation like REX, will be more than lessors will agree to with the bigger more secure operators.

Is Nifty been allowed near the 1998 version of MS PowerPoint again? You'd think after his 4,680 page SAAB engineering course he'd be have alright MS Office skills. Maybe someone at the detention centre.

[MickG0105]

You need to park a lot of Saabs to cover for the capacity of 2 738s. Their results are truly terrible. At some point PAG has to decide if it is going to put in good money after bad or just let the whole thing collapse.
There's far, far bigger matters in play here than suspending a few regional routes. The H1FY24 to H1FY23 numbers for cash in, cash out look something like this:

Pax revenue $311.438 millionup by $18.525 million (+6.32 percent)-
Total revenue $353.388 million up by $13.556 million (+3.99 percent)-
Cash CostsFlight and port operations $85.222 millionup by $8.84 million (+11.57 percent)Engineering and maintenance $54.209 millionup by $16.074 million (+42.15 percent)Salaries and employee related costs $112.940 millionup by $15.612 (+16.04 percent)Selling and marketing costs $18.744 millionup by $3.038 million (+19.34 percent)General administration costs $7.733 millionup by $0.512 million (+7.09 percent)Finance costs $5.728 millionup by $1.235 million (+27.49 percent)
-Fuel $69.641 milliondown by $5.658 million (-7.51 percent)
-
Total cash costs $354.217 million up by $39.653 million (+12.61 percent)+
Rex's cost base has exploded, both in nominal terms and relative to revenue. Draw your own conclusions.

[43Inches]

I'm actually surprised costs have only risen by 12%, the addition of 9 737 should be more than that. My worry is that they have lost the plot on the regional front, the south east coast schedules look dire compared to the traditional schedules of 10 years ago, and that is the powerhouse of their past income. Interesting that they somehow forgot MacAir went broke servicing all those outback routes and not having any premium regional routes to get the gravy in the peak seasons. Somebody seems to think that the subsidized routes are more important than the high traffic NSW patterns. I guess QLink has no idea what it's doing, having pulled back from the outback routes and jumped in on all the routes Rex has pulled back from and is making good profit. Seems like there will be only QLink in regional NSW, Vic, SA in a few years, probably half crewed by disaffected Rex staff. I think somebody in Rex management must be a QLink plant, the amount of free passengers they have just given away the last year or so by pulling back on very profitable routes. I heard even Sharps have thanked Rex management (jokingly) for there terrible route strategy down south that is gifting them passengers.

[Slippery_Pete]

Is this press release from the same person who 18 years ago told his pilots “If you can’t handle the heat, get out of the kitchen!” ?

Doesn’t sound like they’re being poached.

Just sounds like you’re getting what you wanted.

[nomess]

So according to the reported numbers, they are heading for insolvency in about 4-5 months.

As far as I can see, there are two options. Either a second cash injection to keep it going for a few more years, or get Virgin to buy it. Bain would probably prefer to sit back and let it just collapse. Yield gain overnight with no outlay, would make its sale more attractive.

[MickG0105]

So according to the reported numbers, they are heading for insolvency in about 4-5 months.
​​​​​​...

No, I definitely wouldn't say that. They've got another $30 million that they can draw down on from the PAG deal plus $54 million in cash and cash equivalents. Their problem is that they just seem to be blithely barrelling along burning cash with little to show for it, and the plan appears to be just more of the same.

[nomess]

No, I definitely wouldn't say that. They've got another $30 million that they can draw down on from the PAG deal plus $54 million in cash and cash equivalents. Their problem is that they just seem to be blithely barrelling along burning cash with little to show for it, and the plan appears to be just more of the same.
Well that’s a positive I guess. They have enough cash to go 617 days. Now as they add another three aircraft, you would assume that they continue the cash burn and that timeline greatly reduces.

This is just becoming Tiger all over again.

[MickG0105]

I'm actually surprised costs have only risen by 12%, the addition of 9 737 should be more than that.
​​​​​​...
Not sure why you'd reference "9 737". I was comparing the H1FY24 (1 July 2023 - 31 December 2023) numbers to H1FY23 (1 July 2022 - 31 December 2022); the effective change in jet fleet numbers is less than 2 between those periods. Network capacity in terms of ASKs increased by nearly 14 percent between the two halves. Total costs most assuredly should not scale linearly with capacity.

[43Inches]

Not sure why you'd reference "9 737". I was comparing the H1FY24 (1 July 2023 - 31 December 2023) numbers to H1FY23 (1 July 2022 - 31 December 2022); the effective change in jet fleet numbers is less than 2 between those periods. Network capacity in terms of ASKs increased by nearly 14 percent between the two halves. Total costs most assuredly should not scale linearly with capacity.

Yes but operational costs ramp up as you 'operate' so it makes sense the last 6 months was all 9 ships plying the waves, not just the addition of 2. It also depends on when the costs come due and are paid, rather than just a liability. Al things we don't know as are commercial in confidence behind the scenes contracts. When looking at cash movement in large businesses a lot of that cash was spent up to a year or more earlier, the payment just came due during that reporting period.

The scary number is the 42% increase in engineering/maintenance, that is what pushes the cash flow negative, an extra $16mil for a few additional 737.

[hawk_eye]

No, I definitely wouldn't say that. They've got another $30 million that they can draw down on from the PAG deal plus $54 million in cash and cash equivalents. Their problem is that they just seem to be blithely barrelling along burning cash with little to show for it, and the plan appears to be just more of the same.

More of the same….and tendering for the Antarctic contract and putting in EOIs for the Border Force contract.

So many hands in so many pies - meanwhile no one is minding the shop!

[MickG0105]

Yes but operational costs ramp up as you 'operate' so it makes sense the last 6 months was all 9 ships plying the waves, not just the addition of 2. It also depends on when the costs come due and are paid, rather than just a liability. Al things we don't know as are commercial in confidence behind the scenes contracts. When looking at cash movement in large businesses a lot of that cash was spent up to a year or more earlier, the payment just came due during that reporting period.

The scary number is the 42% increase in engineering/maintenance, that is what pushes the cash flow negative, an extra $16mil for a few additional 737.
The last six months was most assuredly not "all 9 ships plying the waves". When you are comparing fleet numbers that are fluctuating, the easiest way to do it is to take the operational fleet size on a month-by-month basis. In the most recent half year, they started the period with seven jets, the eighth aircraft didn't start operations until mid-August, the ninth aircraft didn't start ops until 10 October, the tenth aircraft started ops in mid-December, and they had at least one aircraft up in the Phillipines for two months undergoing heavy maintenance. The difference in the operating jet fleet between the two periods was less than two aircraft.

And we're looking at numbers from the P&L, not the Balance Sheet; they're all current costs, there are no accruals of liabilities. You don't need to know the mechanics of the contracts; standard accounting practices apply.

[43Inches]

Not sure what you are arguing, but you said it yourself, its the costs paid during that half, not liabilities, so it could be payment of costs from a year ago. Theres more liabilities from that half still to paid this half and so on. This is just how cash flowed during this period. Which also means some of the revenue earned is for flights still to be operated and so on...

[Trevor the lover]

Neville Nobody

I'm don't believe paying a lot more to the pilots would make a difference. Firstly, on a good year, Rex's profits wouldn't sustain paying the
pilots of regional 34 seat machines a wage competitive with 180 seat jets. And frankly, small turboprop drivers, captains and F/Os, will still jump to
the left seat on an A320 or 737 for the same or even less money. Pay a young skipper more than a jet F/O and 90% will still go. I believe
we can take that as fact.
Rex does need to pay more but retention solutions lie elsewhere - lifestyle being one, progression onto the 737 being another. And some respect.
But paying jet like wages isn't enough.

[43Inches]

Neville Nobody


I'm don't believe paying a lot more to the pilots would make a difference. Firstly, on a good year, Rex's profits wouldn't sustain paying the

pilots of regional 34 seat machines a wage competitive with 180 seat jets. And frankly, small turboprop drivers, captains and F/Os, will still jump to

the left seat on an A320 or 737 for the same or even less money. Pay a young skipper more than a jet F/O and 90% will still go. I believe

we can take that as fact.

Rex does need to pay more but retention solutions lie elsewhere - lifestyle being one, progression onto the 737 being another. And some respect.

But paying jet like wages isn't enough.


Adjusting pay and conditions at a company like Rex is about setting a flow rate, adjusting a tap. Rex has to be flexible and adjust it's conditions to ensure enough pilots stay long enough to ensure adequate coverage, and a core group of experienced pilots, at least 30%, are retained to train and provide valuable guidance to ensure efficient safe operations. Whilst it's true most young crew are not set on flying a SAAB for a long time many actually will for extended time if the 'conditions' lead to favorable lifestyle. This is why some bases are far more stable in employers like Rex and QLink than others. For Rex traditionally there was a lot of long termers in SA, Vic, Wagga and Albury, Why?, because these bases offered a pretty good lifestyle balance, that is short shifts, lots of time at home, or the single overnight with only about 6 hours duty both days, basically part time work on full time salaries. NSW and now from the sounds of it Qld/WA, are bases where you spend most of your time working, long shifts, with little to no down time, so the flow rate is horrendous. It doesn't take much brain power to understand why the flow rate has turned into a raging torrent in the last year or so, pilots being worked a lot harder, spending large amounts of time away from home, no end in sight of opportunities to move as desired. Now that doesn't mean you can just hire more staff in those bases and work them harder, it doesn't work that way, they are there because the traditional rosters in that base worked well. Increase the work rate for them and they leave like the other bases and you are then left with nothing. The better response would be to try and emulate and expand on the original working conditions in those bases and apply it to the bases where everyone leaves. Or you could focus on those bases and expand their networks with more of the same style of work rate.


Rex can afford to pay a lot more and offer better lifestyle, they just choose not to, they are losing tens of millions in unrealized sales due to not being able to operated schedules during peak seasons. QLink is picking up this slack and profiting on larger aircraft on several routes Rex has cut back on, that shows where the real problem is, it's a matter of priorities.

[Trevor the lover]

So like me, you say its about lifesstyle - money isn't enough to keep them. What makes you think Rex can afford to pay more? All the goss on here seems to indicate they are losing **** loads of cash, reserves are running out, they're almost insolvent, PAG's about to do a runner,reports are being doctored to makes things appear rosier - but you say they CAN afford to pay more? My maths say it doesnt appear that way.

[43Inches]

So like me, you say its about lifesstyle - money isn't enough to keep them. What makes you think Rex can afford to pay more? All the goss on here seems to indicate they are losing **** loads of cash, reserves are running out, they're almost insolvent, PAG's about to do a runner,reports are being doctored to makes things appear rosier - but you say they CAN afford to pay more? My maths say it doesnt appear that way.

Lifestyle clauses are also costs to a company, if you have an 12 hour duty to crew and EBA limits to 6 hours duty only then you need two crews both paid the same amount instead of one under FRMS. I touched on the point that due to crew shortages they have cut back routes and have been prevented crewing new routes that is costing them millions in lost revenue. Its been said many times that a lot of their routes are full, increase the fare, that will pay the extra crew costs, but now it's getting dire as they have done nothing. If QLink can do the routes with more expensive aircraft and crews, why can't Rex? I think the fixation on cost control is their undoing right now, so rigid in not expanding staff costs that everything else is spiraling out of control due to, lack of staff... It's a bit like cutting back on maintenance, you eventually hit a point where the band aids on top of band aids fall off and the cost to actually fix all the problems is 10 times what you would have paid for proper routine maintenance, but the manager at the time just pushes it back so the next monkey has to deal with it (which is also a result of underpaid, overworked, don't care, managers).

[nomess]

And we're looking at numbers from the P&L, not the Balance Sheet; they're all current costs, there are no accruals of liabilities. You don't need to know the mechanics of the contracts; standard accounting practices apply.
Any idea what the exit clauses are here for PAG? I don’t think they planned on funding a bleeding Saab operation.

[markis10]

Any idea what the exit clauses are here for PAG? I don’t think they planned on funding a bleeding Saab operation.
Their not, it’s setup so it can be carved off if need be, funding is specifically for the joint venture.

[MickG0105]

Any idea what the exit clauses are here for PAG? I don’t think they planned on funding a bleeding Saab operation.
I don't think that anyone outside of the inner circles at Rex and PAG would have all the details but basics of arrangement were presented to shareholders back in late 2020. You can find the relevant document here (https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02325986).

From memory the basics are:

​​​​​​a total of $150 million in funding available for drawdown at Rex's discretion within a three year period.
funding to be used by Rex to "establish, launch, operate and expand Rex's Australian domestic Regular Public Transport jet operations". Interestingly, the document specifies the operating aircraft right down to type and configuration.
drawdown is by way of Rex issuing convertible notes/warrants with a face value of $1, and a conversion/strike price of $1.50.
conversion of the notes/warrants to shares at PAG's sole discretion.
there were some conditions precedent relating to early conversion but those having passed, maturity (when PAG can convert) is five years from the first draw down, extendible by up to one year. PAG also have the option of electing to convert any time from the end of the three year draw down period.
4 percent interest on the notes subsequent to drawdown (interest not payable during the extension period if PAG elects to extend).
if PAG elect not to convert to shares, Rex has to pay the drawn down amount back.
PAG get two board seats.

Happy to be corrected on any of the above if memory has failed me (a little more frequent these days).

Bottomline, PAG are tied to Rex for a minimum of another two, and maximum of another three, years from 15 March this year.

I cannot imagine that things are evolving as predicted/hoped for by either party when they entered into the deal. Thus far, it has been a better deal for Rex than PAG, in that 4 percent interest on that sort of sum for a business of Rex's financial stature is below market rates.

[Deano969]

Another ERJ 190 added to NJE fleet
How long until some of these birds do some flying for REX jet
They are a perfect size for new routes into north QLD or extra frequency to OOL
But where they could get the best bang for their buck would be trans con

[Ladloy]

Another ERJ 190 added to NJE fleet
How long until some of these birds do some flying for REX jet
They are a perfect size for new routes into north QLD or extra frequency to OOL
But where they could get the best bang for their buck would be trans con
I doubt they'll do any routes in qld as it wont be subsidised by the qld government.

[itchy_feet]

Another ERJ 190 added to NJE fleet
How long until some of these birds do some flying for REX jet
They are a perfect size for new routes into north QLD or extra frequency to OOL
But where they could get the best bang for their buck would be trans con

NJE doing flying on behalf of Rex is inevitable and the current rumour is NJE to run E190’s on Perth - Adelaide route. But given their current network and schedule, there aren’t enough airframes or pilots to start this up.

The only way NJE 190’s will be in QLD will be for FIFO ops at this stage.

[markis10]

NJE can bleed more money with the latest fleet addition, while RQG headed to the desert, meanwhile what’s the SAAB replacement plan??? Options are quickly disapearring!

[Global Aviator]

Etihad interline, not bad Rex!

https://australianaviation.com.au/2024/03/rex-boosts-overseas-footprint-with-etihad-interline-deal/

[MickG0105]

And Rex announced today that Neville Howell's last day was last Friday. Odd way to send a bloke off who has been with the show since the get-go.

[Ladloy]

And Rex announced today that Neville Howell's last day was last Friday. Odd way to send a bloke off who has been with the show since the get-go.
People don't generally quit that position.

[Icarus2001]

Yes but he is still COO. It is not as if he has departed the company.

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02783142-2A1510860

[MickG0105]

Yes but he is still COO. It is not as if he has departed the company.

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02783142-2A1510860
Thanks for that - I had not seen the media release. A little untidy, nevertheless, being punted from the Board after nearly a decade at the table.

[Icarus2001]

It is straight out of the "circling the drain" script?

Move people around, sack people, change positions. All to somehow change the reality of the numbers.

Sometime soon the fuel supplier or similar will put them on a cash only basis.

[BagoRatz]

Yes but he is still COO. It is not as if he has departed the company.


And this is right after the COO for NJE resigned effective immediately last week...

[nomess]

And this is right after the COO for NJE resigned effective immediately last week...
As in the new bloke they only hired 3 months ago?

[BagoRatz]

As in the new bloke they only hired 3 months ago?
Correct!

[Ladloy]

Ol' Kimmy is feeling the heat.

[dragon man]

As in the new bloke they only hired 3 months ago?


A lack of transparency I’m told

[Slippery_Pete]

Ol' Kimmy is feeling the heat.

Time to get out of the kitchen!

[KRUSTY 34]

And this is right after the COO for NJE resigned effective immediately last week...

Former REX Chief Pilot and COO I Believe?

[BagoRatz]

Former REX Chief Pilot and COO I Believe?
Craig Martin of CASA surveillance fame

[MickG0105]

Craig Martin of CASA surveillance fame
I thought that they had pulled Martin in to advise on their bid for the Antarctic support contract.

[KRUSTY 34]

Craig Martin of CASA surveillance fame

AH, Thinking of someone else. May have been the previous NJS COO/CEO? from a few months back?

Rumour (yes it is a rumour network) was that he "retired" the day his appointment was announced. Just what I've heard.

[BagoRatz]

AH, Thinking of someone else. May have been the previous NJS COO/CEO? from a few months back?

Rumour (yes it is a rumour network) was that he "retired" the day his appointment was announced. Just what I've heard.

Ah yes, that would have been Chris Hine. CM took over late December and was gone by early March.

[DanV2]

REX making a habit of picking up former major (or minor) VA partners for their 'interlines'. DL and now EY.

I wonder if Hainan (HU) will be the next carrier to follow DL and EY to REX for secondary Australia-China interlines considering their route network is from secondary Chinese cities.

https://www.rex.com.au/BlobViewer/BlobViewer.aspx?attachtype=MR&filename=324C6165566E494C2F31584F4E35653139304E3578324772795 775776E56666B4B7441422F5A4647517262656345525A32654D4F3865733 557455A444265743678647973584D794450456B2B68696B3341636944535 13D3D

[MickG0105]

REX making a habit of picking up former major (or minor) VA partners for their 'interlines'. DL and now EY.

I wonder if Hainan (HU) will be the next carrier to follow DL and EY to REX for secondary Australia-China interlines considering their route network is from secondary Chinese cities.

https://www.rex.com.au/BlobViewer/BlobViewer.aspx?attachtype=MR&filename=324C6165566E494C2F31584F4E35653139304E3578324772795 775776E56666B4B7441422F5A4647517262656345525A32654D4F3865733 557455A444265743678647973584D794450456B2B68696B3341636944535 13D3D
Etihad still have their partnership relationship with VA; that arrangement is at least one rung up the ladder in terms of commercial significance compared to a simple interline agreement.

[DanV2]

Etihad still have their partnership relationship with VA; that arrangement is at least one rung up the ladder in terms of commercial significance compared to a simple interline agreement.

Largely a one-way codeshare with EY code-sharing on VA domestic services though, the other way VA had largely replaced EY with QR codeshares via DOH going outbound. Demoting EY to a "minor" partner of VA, which is barely above interline but below the "major partner" tier of Velocity.

[MickG0105]

Largely a one-way codeshare with EY code-sharing on VA domestic services though, the other way VA had largely replaced EY with QR codeshares via DOH going outbound. Demoting EY to a "minor" partner of VA, which is barely above interline but below the "major partner" tier of Velocity.
I don't know if I'd call EY a "minor" Velocity partner; I'm pretty sure that the EY points arrangement with Velocity is a bit better than the QR deal.

In any event, how does that EY-VA relationship compare to the EY-ZL interline arrangement? How much EY traffic do you think Rex are going to pick up?

[Deano969]

I don't know if I'd call EY a "minor" Velocity partner; I'm pretty sure that the EY points arrangement with Velocity is a bit better than the QR deal.

In any event, how does that EY-VA relationship compare to the EY-ZL interline arrangement? How much EY traffic do you think Rex are going to pick up?
One would think very little

[43Inches]

I think what it shows is EY hedging it's bets, they see ZL getting to a level they can sustain some on-carriage if it continues. There's nothing solid in the Australian domestic market apart from QF group. Everyone else is about who will survive in the long run. The vibes coming out of VA are not rosy, but we have little idea of the reality due to the books being private and not knowing Bains end game. ZL we have more an idea, which is not rosy either, but there's still the unknown of how far PAG will go there. Might as well get some agreements lodged with both so if either goes under they have the other to feed off.

[regional_flyer]

CM took over late December and was gone by early March.

Did he refuse to sign up to the company Telegram or something? :cool:

[KRUSTY 34]

Ah yes, that would have been Chris Hine. CM took over late December and was gone by early March.

Do we see coincidence, or a pattern?

[BagoRatz]

Do we see coincidence, or a pattern?
Hard to say, certainly not good optics for the remaining staff - the announcement was sent out on a Saturday evening!

[Ken Borough]

This is brilliant!

https://www.betootaadvocate.com/advocate-in-focus/rex-flight-attendant-asks-if-anyone-has-a-lighter-because-its-5-oclock-and-mummys-lungry/

[MickG0105]

This is brilliant!

https://www.betootaadvocate.com/advocate-in-focus/rex-flight-attendant-asks-if-anyone-has-a-lighter-because-its-5-oclock-and-mummys-lungry/
The description of the "lounge" is pretty much bang on.

[C441]

Another sample of one….
BNE-SYD 25th March.

QF chocker on 7 of the last 8 afternoon/evening flights. Business and economy oversold on a couple of flights - it's rare for that to be displayed on the staff travel website.

Booked the 5:00pm Rex for $169 at 3:00pm - $106 more than the one-way QF Staff seat so a very reasonable fare at short notice. Virgin was "from" $195 for a later flight.
Rex Business had 4 vacant seats and about two thirds (2/3) full in economy.
Service was fine although even though in row 4, I was 'reminded' that the forward toilet is for Business Class but female pax around me were welcomed to use the front loo when they ventured past the cabin divider later in the flight. I had no problem with that and found it somewhat amusing. Maybe experience suggests that economy blokes make more of a mess of the Business dunny! :)

I was offered an exit row seat just prior to boarding for the second time on a Rex flight. On this occasion I was happy in row 4 but it seems Rex pax aren't really prepared to pay for that honour…..well on both of my journeys with them.

[MickG0105]

A fun day out for those looking to get an early start to their Easter hols on the Golden Coast!

https://cimg4.ibsrv.net/gimg/pprune.org-vbulletin/528x1023/screenshot_20240327_195836_flightradar24_ccc9cd0191a9f96ec6e 42db95522105ef607dd21.jpg

[1A_Please]

A fun day out for those looking to get an early start to their Easter hols on the Golden Coast!

https://cimg4.ibsrv.net/gimg/pprune.org-vbulletin/528x1023/screenshot_20240327_195836_flightradar24_ccc9cd0191a9f96ec6e 42db95522105ef607dd21.jpg
The wacky way we measure OTP performance in Australia means this is assessed exactly the same way as a plane that leaves the gate 20 minutes late but manages to arrive pretty much on schedule.

[MickG0105]

The wacky way we measure OTP performance in Australia means this is assessed exactly the same way as a plane that leaves the gate 20 minutes late but manages to arrive pretty much on schedule.
I was thinking pretty much the same; this one, and the return to MEL which was also delayed by 10 hours, get chalked up the same way as a flight that arrives 15 minutes late. In a similar vein, the cancellation of a once-a-day service, where pax are displaced by 24 hours, is indistinguishable from a cancellation where all pax are rebooked within a few hours.

[Deano969]

Like QF/JQ and VA haven't had similar delays....
Then why the delay, ATC, weather, tech ....
Are turnback's counted as delays or cancelations, if cancelations, what is the delay for each passenger as they get shunted onto later flights, often next day
If 50 pax on a flight from SYD-MEL that is cancelled by QF/JQ or VA are bumped over to fill empty seats on the next 3 flights, this should count as 1 cancelation + 3 delayed

Just sayin

[shortshortz]

Like QF/JQ and VA haven't had similar delays....
Then why the delay, ATC, weather, tech ....
Are turnback's counted as delays or cancelations, if cancelations, what is the delay for each passenger as they get shunted onto later flights, often next day
If 50 pax on a flight from SYD-MEL that is cancelled by QF/JQ or VA are bumped over to fill empty seats on the next 3 flights, this should count as 1 cancelation + 3 delayed

Just sayin

No. That would be one cancellation. The others are not delayed.
A cancellation for Bonza is a return of airfare cost. A cancellation for QF is typically a three hour delay (but you get to your destination).
This also skewed against larger carriers.

Just saying

[TimmyTee]

Like QF/JQ and VA haven't had similar delays....
Then why the delay, ATC, weather, tech ....
Are turnback's counted as delays or cancelations, if cancelations, what is the delay for each passenger as they get shunted onto later flights, often next day
If 50 pax on a flight from SYD-MEL that is cancelled by QF/JQ or VA are bumped over to fill empty seats on the next 3 flights, this should count as 1 cancelation + 3 delayed

Just sayin

Utter nonsense.

[Deano969]

So why split hairs over a 30 minute delay verses a 12 hour delay then ?

[Seriously]

QF/JQ/VA would have canceled the flight instead of being 10+ hours delayed. Whereas Rex will just delay it half a day to avoid cancelling it. That way they can carry on in the media about being the most reliable…

[Arnold E]

I see a mass exodus of experienced engineers from the Adelaide base and with more to go, apparently. management not concerned ???

[marreeman]

Apprentices are cheaper, Saabs also being parted out never to fly again. Saab captains already doing 2-3 weeks out of base now given mandatory temporary transfers.
Saab operations paying for all ground crew 20+, ground equipment, parking etc to cover jet, pelair and nje.
It’s the beginning of the end for the Saab operation. I feel for these guys, management should be ashamed of themselves.

[Arnold E]

You may be right that apprentices are cheaper than LAME's, however they cant sign aircraft out. I agree that it looks like the Saab operation is in is dying throws,
however of the guys that recently left 3 of them have 737 licenses, the others soon to go I dont know but they are experienced guys, I dont understand how
you can lose long term employees like that and not be bothered.

[43Inches]

You may be right that apprentices are cheaper than LAME's, however they cant sign aircraft out. I agree that it looks like the Saab operation is in is dying throws,
however of the guys that recently left 3 of them have 737 licenses, the others soon to go I dont know but they are experienced guys, I dont understand how
you can lose long term employees like that and not be bothered.

Stubborn 1950s style management is how this happens. Darwinism at it's best, change with the times or be consigned to history. If you can't adapt to the new world that aviation is moving into, that is no more flood of young enthusiastic aviation employees, then you will have no staff, especially flight crew and engineers. Not many want to do jobs where you have to commute to a place, spend time away from home, etc etc, unless it pays well and has plenty of time off, both of which Rex is failing at miserably and whats more getting worse.

[marreeman]

The apprentices are cheaper, was tongue in cheek comment.

[Arnold E]

Woops,
another key bloke gone, they are bleeding people now, still nobody concerned apparently

[KRUSTY 34]

Just wondering how PAG and the $150M kitty is going?

Asking for a friend.

[MickG0105]

Just wondering how PAG and the $150M kitty is going?

Asking for a friend.
Should be $30 million left undrawn.

Given their H1 performance and their domestic jet numbers so far this half, they can't be too far off making a reasonably significant draw down.

[autopilot11]

What about 54 million in tax payers dollars was granted to Rex in 2020 has been put to use by building a hangar and recently opened 737 sim. How much of that is funding the jet operation

[markis10]

Rex dropped a big sale including discount during the school holidays, sounds like a cash grab, didn’t Bonza do the same a few weeks back….

[MickG0105]

Rex dropped a big sale including discount during the school holidays,
...
And it had no meaningful impact on pax numbers on their domestic jet network. Any time they get into a shoot-out with either of the majors on price, they lose.

[CharlieLimaX-Ray]

Rex ZL9401/9906 B737 YMML-YDPO-YMML Friday lunchtime, would have got East West Loco excited!

[Diff Tail Shim]

ATRs are ****e.

[MickG0105]

Rex ZL9401/9906 B737 YMML-YDPO-YMML Friday lunchtime, would have got East West Loco excited!
What was that? A charter? Looks like it went to Devonport half full and came back empty.

[nomess]

What was that? A charter? Looks like it went to Devonport half full and came back empty.
Spirit of Tasmania was having issues a few days ago with delays/cancellations from a cargo shift incident. Might be moving delayed pax over.

[HOBAY 3]

Rex ZL9401/9906 B737 YMML-YDPO-YMML Friday lunchtime, would have got East West Loco excited!
Well, it might have aroused him; but to get him excited you'd need to match the glory day of 2 x EW F28 on the ground, plus an EW F27 and AN F28 in the circuit or whatever it was 🤣

[CharlieLimaX-Ray]

Yes, the big man would have been in full flight if that was the case HOBAY 3.

EWL used to say that he had the Knight1 SID for selected crews to use when he was in his travel office in Devonport.

[MickG0105]

One of the two PAG directors moving on.

https://cimg5.ibsrv.net/gimg/pprune.org-vbulletin/752x1032/screenshot_20240422_192038_adobe_acrobat_efc1dc06762f2805666 77026875ece6844b38eae.jpg

[MickG0105]

Three additional 737s to join the fleet as Rex announce a small loss, on the last day of VH-RQG being in the fleet.
Any word on when the additional jets are meant to arrive?

[nomess]

Any word on when the additional jets are meant to arrive?

I assume a further cash injection will be landing shortly if they intend to grow the loss making business?

They don’t appear to have enough cash to get out of 2025. Another $100m should tidy them over until 2027/8

[Ladloy]

I assume a further cash injection will be landing shortly if they intend to grow the loss making business?

They don’t appear to have enough cash to get out of 2025. Another $100m should tidy them over until 2027/8
It's an interesting scenario because LKH and Singaporean friends will lose their stronghold. It could be the case that he is shown the door from the board

[MickG0105]

It's an interesting scenario because LKH and Singaporean friends will lose their stronghold. It could be the case that he is shown the door from the board
I think that LKH packed his parachute when he set up a separate JV for the NJE acquisition; it gives him an 'exit, stage left' option.

[markis10]

Any word on when the additional jets are meant to arrive?

At least one more to come this financial year was the plan

[Wizofoz]

At least one more to come this financial year was the plan
I think the plan is hitting the reality of a very tight second hand market.

[nomess]

The next batch of Singapore NGs won’t be available until this December and into the next December. All depends on engineering however on exit.

I note the first few coming off lease are tied to Pembroke who are already tied to Virgin with the old Tiger Singapore A320 leases.

Would be wise for Virgin to pickup all these leases, that should alleviate some fleet pain in the coming years.

I don’t think Rex is in the position to bargain top dollar. Everyone else can, they are really only in the position to negotiate bottom dollar, that ship has now sailed.

[markis10]

I think the plan is hitting the reality of a very tight second hand market.

I am still baffled by the release of RQG by Rex and its subsequent parting out in ASP, market cannot be that tight or it had a serious issue, apart from Rex not willing to pay the market rates in todays market!

[Ladloy]

apart from Rex not willing to pay the market rates in todays market!
This. LKH still thinks he's bullying councils.

[Wizofoz]

I am still baffled by the release of RQG by Rex and its subsequent parting out in ASP, market cannot be that tight or it had a serious issue, apart from Rex not willing to pay the market rates in todays market!
With RQG it seems like the leasor was just determined to convert the aircraft to freight. But I'm sure the rest is probably true- that being said, how much is too much?