Rex has set its eyes on massively expanding its fleet of Boeing 737s to 30 aircraft over the coming five to seven years, with an aim to enter one new plane into service every two to three months.
The news was revealed by Rex chairman Lim Kim Hai at the iconic Singapore Airshow, and nearly doubles Rex’s previous public fleet expansion goals.
“That’s a very good medium-term objective,” Lim said. “There’s a lot to be said for economies of scale.”
It comes after Rex first announced in May 2020 that it was gearing up to rival Qantas and Virgin to take on domestic routes between capital cities and started operating its first 737s in March 2021.
Then Rex revealed late last year that it intends to expand its 737 fleet from six to 14, to support its growing domestic operations.
Lim said the 2021 and 2022 operating environment has “not been easy”, following months of travel restrictions, the Australian Omicron surge and staff shortages.
“No airline makes money when planes are half-full,” he said.
However, the Rex chairman said the worst is likely behind the airline, as bookings pick up steam and point to recovery.
“I’m just starting to see in the last six or seven days a turnaround,” he said. “Significant enough for me to believe that probably the bottom has been reached.”
While the increase in demand is not yet enough to make all flights profitable, Lim said it “gives us some encouragement”.
“You just hope that you ride out the bleed and be there when you recover,” he said.
It’s the latest move in Rex’s rapid expansion of its domestic operations, after earlier this month announcing it will increase its footprint at Sydney Airport with a brand-new Boeing 737 flight simulator and aircraft hangar.
Rex successfully secured the funding for this expansion under the NSW government’s $250 million Jobs Plus program, which provided tax relief, streamlined planning approvals and rebates on constructing infrastructure for businesses creating at least 30 new jobs in NSW by June 2024.
Earlier, speaking at the CAPA Australia Pacific Aviation Summit in Sydney in December, Rex deputy chairman John Sharp said the business has not finished expanding.
“Next year, we intend to go to all capital cities around Australia and indeed to include our growth to some of the larger regional centres, particularly on the east coast of Australia,” said Sharp.
He added Rex’s rapid expansion was made possible because COVID caused “thousands” of aircraft to hit the market at low prices, with lessors “happy to accept any price”.
The pandemic also led to Rex being able to hire staff recently made redundant from larger rivals Qantas and Virgin.
Also in December, Rex started operating flights between Brisbane and Sydney, finally completing the airline’s goal to service the so-called “Golden Triangle” of Sydney-Melbourne-Brisbane.
Rex’s growing domestic network now includes flights between Adelaide, Melbourne, Sydney, the Gold Coast and Canberra.