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Qantas under fire over ‘predatory’ Sydney-Orange route

written by Hannah Dowling | July 3, 2020

Rex has lashed out at Qantas and called for government intervention, following its announcement of a new “commercially unsustainable” Sydney-Orange route.

On Wednesday, Qantas announced that it would be commencing services between Sydney and Orange for the first time, beginning on 20 July 2020.

The airline will reportedly operate three weekly return services between Sydney and Orange on its Q200 aircraft from 20 July, with plans to increase frequency later in the year.

In response, Regional Express (Rex) has released a fiery statement, which has called on the federal government to “review” any financial assistance provided to Qantas from the Australian Airline Financial Relief Package, the Domestic Aviation Network Support package and the COVID-19 Regional Airline Network Support Program.

The regional airline claims that Qantas has “demonstrated that it has spare funds to incur additional losses simply to weaken its competitor at this time of national crisis”, essentially arguing that Qantas has added the Sydney-Orange route as a means to undermine and weaken the financial standing of Rex.


In a statement seen by Australian Aviation, Rex claimed: “Orange currently averages a total of 40 passengers per week and barely fills up 30 per cent of Rex’s twice weekly return flights. 

“Qantas intends to flood the market with another 216 seats a week making it an aggregate load factor of 11 per cent for the two carriers.” 

Prior to the COVID-19 pandemic, Orange had 66,000 annual passengers, with Rex registering a 66 per cent load factor on this route.

“Even if passenger numbers return to pre-COVID levels in the next 12-18 months, Qantas’ entry would see a minimum of an additional 60,000 seats on this market, making the overall load factor for both carriers to be only 41 per cent. This is clearly commercially unsustainable,” the statement read.

A file image of a QantasLink Dash 8-200 at Sydney Airport. (Seth Jaworski)
A file image of a QantasLink Dash 8-200 at Sydney Airport. (Seth Jaworski)

Rex continued, and stated that QantasLink has made the decision to not yet re-commence services on some routes, including Sydney-Wellcamp, which could be fully underwritten by Commonwealth funding.

Instead, the airline is opting to service Orange, which reportedly does not qualify for Commonwealth funding. 

“It is obvious that Qantas’ action is not competition on its merits but rather predatory behaviour aimed at weakening Rex at a time when all airlines, including Qantas, are sustaining operational losses, hoping that if Rex collapses it will have the regional aviation market to itself,” the statement said.

“Given that Qantas has enough money to engage in non commercially-viable ventures, it clearly shows that Qantas does not need any financial assistance. 

“That being the case, the federal government should not be using tax payers’ money to prop up Qantas even as the latter leverages on its financial muscle to try to destroy both its domestic and regional competitors during this pandemic.”

Rex had previously lodged a complaint with the Australian Competition and Consumer Commission (ACCC) on 31 January 2020 with regards to Qantas’ “predatory behaviour”.

This comes just weeks after Treasurer Josh Frydenberg instructed the ACCC to monitor whether airlines are reintroducing capacity too quickly purely to damage rivals, following Qantas’ announcement to add 300 more return flights per week by the start of July.

The commission will look for “early signs of damage” or moves that could “damage a competitor or drive them off route”.

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Comments (26)

  • James


    How do they know the route will be unsustainable?

  • Craigy


    Rex at it again. When they start a route already services by another operator, its competition. For the second time in a year, Rex is calling predatory activity when their monopoly is opened to competition. Hypocrisy again from this joke of a business.

  • Paul Robson


    Rex crys wolf yet again!
    Maybe Sharp needs to talk to Mcormack!

  • Peter


    This behaviour needs to stop. We need a vibrant airline industry and Qantas seems determined to run everyone else out of the sky’s for their own gain. Why? Do they really need to be flying low passenger routes to regional areas? They have a majority position across all domestic routes already. Leave the regional alone.

  • Colin kay


    Will someone PLEASE start a direct MEL-CFS flight. The Tiger jet was always full both ways to Coffs Harbour. A Syd stop is a pain.

  • Kevin


    And yet REX thinks it’s ok to announce the introduction of jet services between Brisbane, Sydney and Melbourne? They want protectionism where it suits them yet a chance to compete on routes that are themselves subject to recovery from the downturn in demand due to COVID-19. Perhaps REX’s load factor between Orange and Sydney was a function of its monopoly and pricing and like routes that Virgin introduced to compete with Qantas (I’m thinking Brisbane-Bundaberg), this competition will reduce fares, stimulate demand and increase passenger numbers between the two cities.

  • Sean


    REX seems to have a penchant for making loud and continuing complaints with respect to their regional operations. They seem to regularly attack local councils and complain about competition. Was it not just a few weeks ago that they received significant handouts from the Australian people to sustain other regional services? Have they not announced that they are entering the Australian domestic jet market on the East Coast and competing with Qantas and its existing competitors? Seriously?

  • Neil


    If ever an award is given for whinging, the Kim Hai/ Sharp duo will win hands down.
    Why isn’t this foreign airline flying geriatric equipment exposed for what it is! Rex talks nothing of its proposal to compete with Qantas and Virgin on the Brisbane/Sydney/ Melbourne golden triangle.
    The National Party has paved their corridors with gold in Covid relief disproportionate to Qantas and VA receipts.
    Best McCormack stops propping them up. Strange that they can go from pleading failure then weeks later they can announce launch of a jet operation on the golden boomerang. SCORE for CREDIBILITY= 0

  • Steve Purvinas


    Amazing comments from Rex who are using their Govt. assistance to attack Qantas and Virgin on their major routes.

  • Rex have a case here. I have noticed in recent days that there have been flights operating ADL-Orange-ADL. Operated by Alliance with the F70. This follows the extension of the runway at Orange in recent times. These may have been charters.

  • AgentGerko


    And yet Mr Joyce will again put on his best Irish little boy face and say “Oim not at all interested in trying to hurt other airlines.”

  • Rocket


    What a total crock…

    Rex is allowed to announce it’s planning to acquire 737s or A320s and compete with Qantas/Jetstar on SYD/MEL/BNE routes, something WELL outside its historical market but Qantas Group is not allowed to operate to/from a regional port historically the purview of Rex via Qantas Link (a regional carrier).

    This totally Singapore (read: foreign) owned carrier demands and gets a lifeline from the federal government to support its operations during COVID-19 which no one else gets. Rex is a protected species.

  • Gerry


    This seems ironic, given Rex announced plans to purchase B737s to compete against Qantas and Virgin on the capital city routes, after receiving a considerable bailout from the Federal government in April.

  • Mike


    Hahahahahahaha Rex can’t handle competition, go on give em another $54million McCormack.

  • AvGeek


    I normally loath Qantas and would be arguing to support pretty much anyone else! But after last week’s announcement of their move to the Golden Triangle and having been a ‘guest’ experiencing their ‘service’ regularly over the last 18m, I say Bugger Off Rex!

    Try this statement – “Given that REX has enough money to engage in the start up of a new Jet fleet in a highly competitive market during a world & aviation crisis, it clearly shows that Rex did not need any of the financial assistance it received out of proportion to its relative size”.

    This is the typical grandstanding and yapping we’ve come to expect from Rex. Do they ever stop? It’s just background noise now… Yap, yap, yap!

  • auger


    Why does not REX stop winging and just ask their mates int Lib/Nat Governments to give them even more subsidies. It has worked in the past.

  • Pete


    Australia: the country where tax payer funded corporate watchdog is instructed to ensure a successful Australian company doesn’t play too tough against its poorly run foreign competitors!

  • Paul


    Interesting that REX is upset with Qantas over competition on the Sydney-Orange route, but happy to go head to head with QF on the Brisbane-Sydney-Melbourne golden triangle! If REX want to play against the big boys in some areas, they can expect QF to react in the way they are. They can’t have it all there own way!

  • AlanH


    “Rex has lashed out at Qantas and called for government intervention …” Of course it has. Can’t have any of this competition malarkey. The Gov’t should do something about it. Ummm … who is attempting to undermine Qantas by opening up cheap air fares on the major trunk routes Brisbane-Sydney-Melbourne? Perhaps the Gov’t should do something about that too!

  • Gavin H


    Haha, you cannot make this stuff up! This coming from Rex, the foreign airline who were gifted tens of millions of dollars after declaring they were on deaths door – and weeks later announce jet expansions and breaking ASX laws.
    Sharp, his Singaporean boss and the rest of the Rex team live in fantasy land (co-occupied by the Nationals/McCormack)

  • Greg


    This is hilarious considering that REX begged for – and got – government funding and is now talking about expansion purely to hurt Virgin’s chances while they’re in trouble. Can’t have your cake and eat it too REX!!!

  • Jason


    So Rex can paddle in QF/VA’s Golden Triangle pool, but QF can’t paddle in their’s ??

  • Red Cee


    How can Rex honestly see it as preditory, when they are hoping to enter capital city routes?

  • Glenn


    This is the same Rex that have announced they will compete with Qantas on the Sydney-Melbourne-Brisbane routes. Before COVID-19 they said they were planning to fly Orange to Melbourne and Brisbane, two routes already serviced by FlyCorporate. So, Rex want it all to itself, no-one can compete with Rex, but Rex can compete with everyone else! They are a despicable airline (with great pilots and cabin crew).

  • Bill Keech


    This is a disgusting turn of events by QANTAS. To do all it can to destroy REX in the worst way possible while haemmoraging money is totally wrong. I hope the government will step in and suspend funds being given to QANTAS. Better still would be QANTAS shareholders telling Alan Joyce to knock it off.

  • Anthony


    Get real REX!!!
    Hypocritical, snake like behaviour!!
    Claiming to be the victim when it suits…..
    It is making a mockery of the system that supported REX’s poor me claims. and the Australian tax payer who was hoodwinked as was our Government for enabling the substantial grab for cash…? Only to miraculously declare capital city route intentions while crying victimisation over other airlines adapting to the volatile environment..and creating new domestic routes to drive domestic tourism…
    Where is the ACCC’s position on this?
    Our national carrier is being mud slung by what can only be described as opportunistic, deceitful behaviour during the current economical crisis…
    The Australian public should be appalled by this display of theatrics and demand an investigation.

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