Rex aims to rival Qantas, Jetstar and Virgin Australia by expanding its network to service capital cities by early next year.
Deputy chairman John Sharp informed the media on Tuesday morning of the regional airline’s intention to capitalise on recent market upheaval and boost its fleet to include 10 narrow-bodied jets.
Sharp suggested that Australia “may as well” have a three-airline market, noting that the new and improved Rex is likely to sit “halfway between a full-service airline and a low-cost airline”.
“The domestic aviation market is not going to go back to what it was three months ago so we are ready to scale up in line with demand,” he said.
“We are doing this because we see an opportunity. We have the advantage of having successfully run an airline for 18 years.”
The expansion would be funded by a $200 million capital investment, with the regional airline already in discussions with “half a dozen private equity and investment companies”, just six weeks after cautioning that government that it was on the brink of bankruptcy, and in need of financial assistance in order to continue the transport of medical tests and supplies around Australia.
The move would see Rex fly between Sydney, Melbourne, Brisbane, Adelaide and Perth, with the intention of kicking off the new routes by early next year, when domestic travel restrictions have lifted.
To facilitate the busier routes, Rex will lease 10 new narrow-bodied jets, likely to include Boeing 737s or Airbus A320s, just four short of matching Virgin Australia’s budget arm Tiger Air’s previous fleet size of 14.
The lease of narrow-bodied passenger jets will be a first for the regional carrier, benefiting from the global decline in aviation demand and subsequent drop in demand for aircraft.
Rex has reportedly already notified the Civil Aviation Safety Authority regarding amending its Air Operators Certificate to include jet aircraft.
Sharp noted that the airline’s jet expansion will also see Rex bolster its workforce, and is intending to hire new pilots, cabin crew and ground staff, while leveraging its existing management and corporate infrastructure to run the new services at low-cost.
He has assured that Rex will be a strong disruptor in the domestic travel market, offering capital city routes at prices far below Qantas and Virgin Australia, and highlighted that Rex will become “the only capital city operator that is debt-free”.
Sharp highlighted that even in matching the salaries paid to Jetstar captains, “we will be 20 per cent cheaper than Virgin”.
The capital investment to get Rex’s new capital city expansion moving should be finalised within the “next three weeks or so”.