Regional Express announced on December 24 that it is quiting its Mackay to Townsville route from January 1 2010, and that it has launched a complaint with the ACCC against competitor QantasLink.
Rex launched Mackay-Townsville services on October 1 2009, marking its re-entry to the Queensland market. However, the airline claims that in response to its starting services on the route, QantasLink “slashed their entry level fare around 35 per cent and reduced their services to Torres Strait and Weipa so as to be able to dump some 40,000 additional annual seats on the Mackay to Townsville route”, a Rex statement reads.
Rex general manager Network Strategy & Sales Warrick Lodge said, “We are extremely disappointed that we have had to take this action, however with the fares and capacity now on the route it is simply not sustainable. Rex has worked extremely hard to reach out to the local community for their support, however after almost three months of determined effort we have been forced to acknowledge that our competitor’s predatory practices have been effective.”
“Rex wishes to reassure the community that this exit does not represent a disengagement from Northern Queensland,” Lodge continued. “On the contrary, on the back of the recently awarded Northern 1 and 2 licensed routes by the Queensland state government, Rex has announced the commencement of a new non-stop express service between Townsville and Mount Isa. Both of these new initiatives commence from 31st January 2010 and to facilitate this expansion, Rex is deploying an additional Saab 340 aircraft growing the fleet to 4 from 3.”