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Rex gets CASA nod to fly 737s on Golden Triangle

written by Adam Thorn | December 16, 2020
VH-VUF ex-Virgin 737 Rex Dave Soda
The now infamous ex-Virgin 737 leased to Rex, VH-VUF, has been flying back and forth between Sydney and Melbourne (Dave Soda)

Rex has passed the final regulatory hurdle in its bid to operate capital city routes after CASA cleared the airline to fly its new fleet of 737s.

The airline also confirmed it would be offering work to employees made redundant by its rivals.

Australian Aviation previously reported how the now-famous first ex-Virgin 737 leased to Rex had been flying back and forth between Sydney and Melbourne, likely in preparation for its proving flight. It comes after Rex finally signed off on a $150 million investment that will allow it to lease an initial six 737s to fly the so-called Golden Triangle from 1 March.

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On Wednesday, the business revealed it has now acquired a “High Capacity Air Operator’s Certificate”, which allows it to fly aircraft with more than 38 seats or weighing more than 4,200 kilograms. Its current fleet of 60 Saab 340s carry slightly fewer passengers.

Rex used the good news to double-down on its plans to operate as a mid-market hybrid.

“Travellers for the first time do not have to choose between cheap fares with minimal service or more reliable service with premium pricing,” the business said in a statement. “Just as it has done for the last 70 years through its founding airlines, Rex will provide domestic travellers with a safe and reliable yet affordable air service with its trademark country hospitality.”

Rex’s executive chairman, Lim Kim Hai, praised CASA and its outgoing chief executive, Shane Carmody, for granting the certificate so quickly.

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“CASA’s commitment and dedication to the recovery effort during this period of national emergency is nothing short of outstanding and exemplary,” said Lim. “Under the leadership of Shane Carmody and Craig Martin, CASA has gone above and beyond to ensure that the aviation industry is fully supported by the regulator in all aspects.

“CASA’s assistance was critical at a time when all airlines were fighting for survival. I take this opportunity to place on record my very best wishes to the CASA CEO and director of aviation safety for his impending retirement.

“Shane has undoubtedly been the most effective and visionary of all the CASA CEOs I have worked with over the last two decades and he can be very proud of his impeccable service to the nation spanning some 45 years.”

In May, the airline announced its ambitious plans to take on Qantas and Virgin by expanding its network to service Australian capital city routes, including the coveted Golden Triangle – between Melbourne, Sydney and Brisbane.

The news that a deal for new routes will launch comes after Rex recorded an underlying profit before tax of $250,000 and an increase in revenue, from $318 million last year to $322 million in FY20, despite the coronavirus crisis.

The positive results also marked a remarkable turnaround from March, when Rex warned it would have no choice but to announce the “shutting down of its network” if it didn’t receive financial aid, even threatening to stop transporting COVID-19 testing samples.

The strong performance was in part attributed to the company accepting $62.1 million of government grants, including JobKeeper and regional aviation bailouts.

This led to Qantas chief executive Alan Joyce attacking Rex for accepting the handouts before unveiling plans to expand its network. “That doesn’t feel right,” said Joyce. “That doesn’t seem right.”

Rex fired back, stating Joyce was “misinformed by his advisers” and arguing that it was impossible to use the COVID-19 payments for improper means because they are “strictly audited” by Ernst & Young.

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3 Comments

  • Warwick

    says:

    Is this going to be a ‘fly by night’ situation for Rex?
    Taking on QANTAS, on its’ ‘home turf’, so to speak, is either very brave, or very foolhardy. I know which is my thinking!
    Time only will tell.

  • Nate

    says:

    JQ’s gearing-up now, to take on REX nose-to-nose!
    Should be interesting come March 2021, IMHO.

  • Chris

    says:

    Well done REX, it’s encouraging to see you giving it a go. Wishing you success with this new business strategy in a very competitive market. There’s room for more competition so maybe the travelling public will sit up and take note. Congratulations!

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