REX AIRLINES Trading Halt
Joined: May 2010
Posts: 446
Likes: 78
From: australia
The only reason I can see it being so is that while it would be possible for other regional carriers to take on all (well most) of Rex's regional routes, from the government's point of view this may be in the 'too messy' basket and it would just be easier for them to throw money at Rex and ensure that a Rex 2.0 becomes a reality.
Would such talks actually be going on anywhere at the moment or are they still actually hoping for a commercial buyer?
If 2.0 does become a reality, I'd be fascinated to see if the 30 odd Saabs currently laying around with missing organs will all be returned to flying condition.
Joined: May 2010
Posts: 446
Likes: 78
From: australia
The feds are a particularly tone deaf breed, and whenever the topic of regional/remote/isolated communities comes up, they tread very carefully before having to make unpopular decisions.
Joined: Jul 2018
Posts: 693
Likes: 208
From: Sydney
It's either a government which fear backlash from the general public or the other side which write blank cheques to the mates who head the board. You can't win.
Joined: Oct 2024
Posts: 10
Likes: 7
From: Sydney
been following a few weeks now.
Will the government out Rex. More than likely and the deal is probably being done at the moment. The bail out would only cover the regional part hence why Pel-Air, AAPA Wagga & the like are on the market. More than likely NJE 50% share will hit soon as well. Everything will be sold that can be sold to lower the bail out amount with Pel-Air being sold and the 170M secured credit gone it just leaves PAG, Employees, ATO & EY with the rest being cents on the dollar in a DOCA arrangement.
Sold so far
Simulator Centre sold (5-10M assuming)
B737 Parts including an engine (10-20M in parts)
House in Mascot Sold (market would say around 3M)
Pel-Air 47.1M + 170M Debt (217.1M)
For Sale
AAPA Wagga (should go for 20-30M)
HQ & Annex (Should be around 15-20M)
To come:
NJE 50%
hangar
APPA Ballarat
Will the government out Rex. More than likely and the deal is probably being done at the moment. The bail out would only cover the regional part hence why Pel-Air, AAPA Wagga & the like are on the market. More than likely NJE 50% share will hit soon as well. Everything will be sold that can be sold to lower the bail out amount with Pel-Air being sold and the 170M secured credit gone it just leaves PAG, Employees, ATO & EY with the rest being cents on the dollar in a DOCA arrangement.
Sold so far
Simulator Centre sold (5-10M assuming)
B737 Parts including an engine (10-20M in parts)
House in Mascot Sold (market would say around 3M)
Pel-Air 47.1M + 170M Debt (217.1M)
For Sale
AAPA Wagga (should go for 20-30M)
HQ & Annex (Should be around 15-20M)
To come:
NJE 50%
hangar
APPA Ballarat
Joined: Apr 2010
Posts: 375
Likes: 65
From: Brisbane
been following a few weeks now.
Will the government out Rex. More than likely and the deal is probably being done at the moment. The bail out would only cover the regional part hence why Pel-Air, AAPA Wagga & the like are on the market. More than likely NJE 50% share will hit soon as well. Everything will be sold that can be sold to lower the bail out amount with Pel-Air being sold and the 170M secured credit gone it just leaves PAG, Employees, ATO & EY with the rest being cents on the dollar in a DOCA arrangement.
Sold so far
Simulator Centre sold (5-10M assuming)
B737 Parts including an engine (10-20M in parts)
House in Mascot Sold (market would say around 3M)
Pel-Air 47.1M + 170M Debt (217.1M)
For Sale
AAPA Wagga (should go for 20-30M)
HQ & Annex (Should be around 15-20M)
To come:
NJE 50%
hangar
APPA Ballarat
Will the government out Rex. More than likely and the deal is probably being done at the moment. The bail out would only cover the regional part hence why Pel-Air, AAPA Wagga & the like are on the market. More than likely NJE 50% share will hit soon as well. Everything will be sold that can be sold to lower the bail out amount with Pel-Air being sold and the 170M secured credit gone it just leaves PAG, Employees, ATO & EY with the rest being cents on the dollar in a DOCA arrangement.
Sold so far
Simulator Centre sold (5-10M assuming)
B737 Parts including an engine (10-20M in parts)
House in Mascot Sold (market would say around 3M)
Pel-Air 47.1M + 170M Debt (217.1M)
For Sale
AAPA Wagga (should go for 20-30M)
HQ & Annex (Should be around 15-20M)
To come:
NJE 50%
hangar
APPA Ballarat
Joined: Nov 2005
Posts: 215
Likes: 30
From: Over there
Yes I really hope the free market is left to its own devices.
By all accounts Rex's regional business model was unsustainable. Lack of parts, pilots, engineers.
Let competent operators fill the void.
By all accounts Rex's regional business model was unsustainable. Lack of parts, pilots, engineers.
Let competent operators fill the void.
Joined: Oct 2007
Posts: 3,628
Likes: 1,183
From: Aus
The downfall started in many areas, but the key points are;
One - that they tried to practice adversarial industrial relations in a shrinking/tight employee market, not understanding the real value of key employee groups and the additional costs of low experience in a skilled workforce environment = inept management. The employees were there and left due to no quarter provided by management at key times in history. The new employees, whether it be pilots or engineers have to operate for a number of years to catch up with the efficiency gains the old employees had by experience on type, in the mean time costing the operation more, whether it be direct/indirect training costs or online 'learning' experiences.
Two - they failed to understand the nature of their own machines and operational cost consequences of not investing in continual upgrade of said machines, and additional preventative maintenance of ageing plant and equipment and the consequences/costs of not doing so = inept management. The SAABs would be absolutely fine for the market they exist in for at least another 10-15 years or more, given a proper upgrade program started 10+ years ago, as it is the company played with cosmetics rather than real efficiency improvements.
Three - failure to understand the benefits of proper sustained and targeted marketing and advertising = inept management.
Four - failure to work with employees and target markets to improve and expand services, following the management mantra 'we know best' = inept management.
That being said the other operators in the market Rex will exit are worse and are all struggling at present with the same issues due mostly the same factors.
QLink is almost a carbon copy of Rex in it's problems, it just has a mother-ship to look after it and pay for it's mistakes.
Link, is not doing particularly well, so long term viability is an issue there, they may be fullish, but the contracts with VA are like the regionals in the US of the past keep a lid on profits.
After that it's all minor players with poor track records similar to Rex in management.
Joined: Dec 2023
Posts: 1,150
Likes: 889
From: Oz
Link would need a capital raise and extremely unlikely any major lender would assist, they would need to lean on Bain or Canberra to borrow. That doesn’t really solve the medium term Saab issue, from all reports, Link hasn’t invested much in the way of fleet longevity either.
Perhaps it might be easier for Canberra to just bite their teeth, do a fare subsidy deal with QLink, and get Qantas to take on the capacity.
A whole bunch of Rex routes outside of NSW can be offloaded to others.
Perhaps it might be easier for Canberra to just bite their teeth, do a fare subsidy deal with QLink, and get Qantas to take on the capacity.
A whole bunch of Rex routes outside of NSW can be offloaded to others.
Registered User
Joined: Jan 2015
Posts: 14
Likes: 10
From: CNS
https://www.cairnspost.com.au/news/c...3dd8390b7a0448
There wasn’t much talk of government assistance almost 10 years ago when Skytrans collapsed following the loss of the North QLD subsidised routes to Rex.
There wasn’t much talk of government assistance almost 10 years ago when Skytrans collapsed following the loss of the North QLD subsidised routes to Rex.
Joined: Jan 2008
Posts: 300
Likes: 39
From: NQLD
https://www.cairnspost.com.au/news/c...3dd8390b7a0448
There wasn’t much talk of government assistance almost 10 years ago when Skytrans collapsed following the loss of the North QLD subsidised routes to Rex.
There wasn’t much talk of government assistance almost 10 years ago when Skytrans collapsed following the loss of the North QLD subsidised routes to Rex.
What was left of Skytrans Mk1 wasn’t worth saving. Also no substantial route network that couldn’t immediately be taken over by other operators. West Wing took LHR/AUR and KOW/PMP days later, Rex took Bamaga. Brisbane was just mining charter which is not a govt problem…
Joined: Feb 2024
Posts: 19
Likes: 0
From: Australia
So that extended November 25 deadline that the administrators went to court to achieve, is fast approaching. Seems very quiet in REX land...
Starting to feel a lot like the Bonza situation, which of course ended in liquidation. The Administrators were first very confident of a sale within 5 weeks. Then that became late September. Now it's November, and still no news.
Starting to feel a lot like the Bonza situation, which of course ended in liquidation. The Administrators were first very confident of a sale within 5 weeks. Then that became late September. Now it's November, and still no news.
Joined: Feb 2024
Posts: 19
Likes: 0
From: Australia
Joined: Jan 2006
Posts: 2,535
Likes: 224
From: Sydney Australia