REX: secures funding for Capital city domestic expansion

REX has finally signed (19 November 2020) with PAG Regulus Holdings for AU$150 million in funding to be used for the launch of capital city to capital city domestic jet operations starting on 1 March 2021.

This will add a 4th carrier into the Australian domestic market, joining Virgin Australia, Qantas and Jetstar.

“Preparations for our domestic operations are proceeding to plan with our first Boeing 737 800NG aircraft delivered on 5 November 2020. Our crew will carry out training on the aircraft over the next 3 weeks before the CASA proving flight on 2 December 2020. We anticipate CASA approval shortly after. Five other similar aircraft will be delivered from next month to March 2021.”

Lim Kim Hai, Rex’s Executive Chairman

Rex has a bit to do. It has a website that takes you back to when people only had dial-up internet. It lacks a contemporary frequent flyer program and a capital city lounge network. It currently only runs lounges in Adelaide, Melbourne and Sydney.

“We will debut on the Sydney – Melbourne route with 3 aircraft on 1 March 2021 and will ramp up to 5 aircraft by Easter that will see flights to other capital cities. Once the initial services are well established, we aim to progressively grow our fleet to cover all the major cities in Australia.”

Lim Kim Hai, Rex’s Executive Chairman

Another mid-market airline

We don’t know what the airline model will be – maybe another mid-market like the new Virgin Australia? We do know that with their 737-800’s all ex-Virgin Australia planes, they will come with Business Class.

About Rex

Regional Express (REX) are Australia’s largest independent regional airline with a fleet of 60 Saab 340 aircraft
prior to the pandemic on 1,500 weekly flights to 59 destinations around Australia. Rex also owns Pel-Air Aviation specialising in air freight, aeromedical and charter operations and 2 pilot academies located in Wagga Wagga and Ballarat.

2PAXfly Takeout

The aviation industry has a difficult road ahead when it comes to sustainability. It’s going to require a relative revolution in technology, with ‘electric planes’ or hydrogen planes, or some form of jet engine that doesn’t require a carbon based fuel. And that is going to require the development of an alternative to jet engines probably.

It’s a big ask. It will take time to develop.

This move to home grown and manufactured SAF is a first step – maybe even a baby step in a very long road of innovation. In the long run, US$200 million won’t even touch the sides.

The advent of Rex on capital city routes will make domestic flying in Australia interesting, especially in the first quarter of 2021.

I’m imagining that Rex will have the hospitality of a Country Women’s Association (CWA) afternoon tea. Well at least that’s the model I would pursue if I was in charge of REX!