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Rex Airlines has reignited a longstanding battle with Qantas over its fleet expansion into previously Rex-exclusive routes, after pulling out from a key battleground.
Rex announced it will exit the Melbourne-Albury route after 39 years, with its final service on the route to take place on 29 May. It comes after Qantas took on the service in February 2021, with the move to see Qantas claim a monopoly on the route.
Melbourne-Albury was one of the first eight previously Rex-exclusive routes that Qantas subsequently entered, which sparked a fiery war of words between the two carriers, and an ongoing back-and-forth that has seen both airlines battling over each other’s regional routes.
The battle saw Qantas CEO Alan Joyce mock Rex’s “empty aircraft” while Rex deputy chairman John Sharp called Qantas’ moves “predatory”, and questioned how Joyce can “look at himself in the mirror some mornings”. Qantas has consistently denied any wrongdoing.
“This route is the casualty of Qantas’ illegal predatory behaviour to drive out competition in a war of attrition, knowing that its competitors do not have the balance sheet to lose money indefinitely,” Sharp said of Thursday’s decision.
Sharp stated that pre-COVID, about 22,000 passengers per year flew between Albury and Melbourne, which he said is “hardly enough passengers for one carrier let alone two”.
“Qantas then entered the route – one of nine Rex regional routes targeted by Qantas during the COVID pandemic – dumping an additional 31,000 seats annually into the market,” he said.
“It is with a heavy heart that we have to exit this route, after servicing it faithfully for the last 39 years. Rex has no choice but to look after itself.
“Sadly for the community, we will soon see Qantas providing only a token service once it sees that it has achieved its objectives.”
The news comes after a brief ceasefire in the aggressive back-and-forth, which last saw Rex pledge in February to pursue “all legal avenues” against the Flying Kangaroo, and promise to launch more services on routes that compete with Qantas.
In response to Rex’s withdrawal from the route, a Qantas spokesperson said, “Rex’s standard approach whenever it withdraws from a route is to blame Qantas.”
“We don’t start routes if we don’t think they will be commercially viable and that applies to our Albury-Melbourne flights,” they added.
“We are committed to the route which has been performing well, particularly with the Albury community who are connecting on to our domestic and international network from Melbourne.
“Rex operates more than forty per cent more seats between Melbourne and Albury than Qantas, so we are hardly flooding the market.
“We see strong growth potential in the region and have launched three new routes to and from Albury in the past two years, only one of which was also serviced by Rex.”
The tit-for-tat battle ramped up after Rex announced plans for its own grand entrance into capital city routes in 2020 on a fleet of second-hand Boeing 737s. The previously regional carrier took off on its first Melbourne-Sydney flight on 1 March 2021.
In February 2021, Qantas took on eight separate routes that were previously exclusive to Rex: Sydney-Orange, Sydney-Merimbula, Sydney-Griffith, Melbourne-Merimbula, Melbourne-Albury, Melbourne-Wagga Wagga, Melbourne-Mount Gambier, Adelaide-Mount Gambier.
Qantas has previously said of the battle: “Rex’s idea of competition is that it’s something that happens to other people, because they believe they have an enshrined right to be the only carrier on some regional routes.”
Earlier this year, Qantas announced it would soon also begin operating two weekly return flights between Sydney and Broken Hill – a route that Rex has operated solely for 18 years.
Speaking with ABC Radio in February, Sharp accused Qantas of unnecessarily “swamping” the market but insisted Rex would adjust its operations as needed to compete.
Sharp suggested that Qantas was only moving into the Broken Hill route in order to “retaliate” at Rex’s decision in late 2020 to expand into the domestic capital city market, placing it in competition with Qantas.
“They don’t like that, and they’ve made lots of complaints to people about our behaviour in moving into that market. So, in retaliation, they’ve been moving into our regional market,” Sharp said.
Lindsay
says:Sharp HATES competition, especially from QANTAS!
He thinks certain routes’ are his alone,& that nobody else should be allowed to fly on them, so then Rex has a monopoly.
Then he jumped onto the ‘golden triangle’ routes’. How about calling that ‘predatory’.
Did he expect QANTAS not to retaliate?
He’s very jealous of the massive Airbus orders’ that QANTAS has made, whereas he gets, maybe, a 7th 2nd hand Boeing 738, with its’ Singaporean billionaire owners’ just putting a measly $ carrot in front of him.
Sharp’s all bluster, politely put, as he believes any type of publicity is good.
Can’t wait to hear Rex’s financials’ at 30-06-2022, bet they won’t be in the black, then he’ll accuse QANTAS CEO Mr Alan Joyce of some nonsense or other.
kim
says:So Rex starts playing in Qantas backyard and brag about it.
But when Qantas plays in there backyard they whinge.
Remember Rex started paying in Qantas’s backyard first
As Rex called it when the first started in on Qantas’s backyard.
“It’s called Competition”
BANKS
says:It’s almost like we’re in a free market where competition enables customers to choose which airline they prefer, turns out for the last 39 years they haven’t been satisfied with Rex’s offering and offloaded to Qantas in enough numbers where it was no longer sustainable for them to fly.
More of a reflection of Rex then Qantas isn’t it?
Don’t worry, John Sharp will whine even louder then a tornado alarm to his best mate Barnaby and get another $150m to have another go at it again with their fleet expansion. How’s those B737 loadings looking John? “No airline makes money when planes are half-full,” remember.
Lindsay
says:BANKS, you hit the nail on the head in your well-worded comment.
Sharp has the ‘gift of the gab’, as a former pollie, who career there was less than stellar.
He’s got 60 very old Saabs, which are prone to have a propeller fall off, circa 2018, with still some of them being leased.
He’s got 6 second-hand Boeing 737-800 currently, with supposed one more due this year sometime.
Then his ‘mate’, QANTAS CEO Mr Alan Joyce, & Board, order 52 brand-new various Airbus models, with 94 on option between now & 2034.
Rex is owned by billionaires’ in SIN, who don’t seem to want to hand funds over to Sharp for equipment.
Why not? Think it’s pretty obvious.
Adrian
says:Whenever Sharp starts having jibes at QANTAS, does it mean Rex is in a sticky financial situation?
He seems to do this on a regular basis, which is a strange way of ‘doing business’.
The end of 21-22 FY is looming, maybe that’s why he’s getting a tad vociferous.
Rex’s balance sheet should make for interesting reading when it’s published.
Howard
says:Rex was formed in 2002.
Sharp says it flew MELABX for 39 years’.
Maybe he needs to relearn his adding & subtraction tables again.
Salesh Prasad
says:Rex did the same thing to a carrier out of Newcastle, then left Newcastle.
Toady
says:I remember when Kendell and East West both competed together on the Melbourne – Albury route.
Louise
says:John Sharp is unbelievable. Seems to spend all his time complaining about QF and clearly believes he is entitled to monopolies on routes, as long as his airline operates them. He is only making money on these regional monopoly routes because he can charge whatever he wants – not looking after the country people when a short regional flight costs hundreds of dollars, is shorter than his 73H flights, where they are charging less than $100 a seat. Maybe if Sharp focused on promoting his airline, that would actually help.
Mark
says:All very nice , but if Rex goes bust , you can guarantee Qantas will pull out of all these routes soon thereafter.
Wayne
says:Rex and Qantas fly out of Mildura. As a long term flyer I/we always begrudgingly fly Qantas (mostly more expensive) than Rex as their aircraft are so old and noisy.
When Virgin flew out of here, their planes were beautiful Embraer 190’s and 737’s and a lot of people flew Virgin instead of Qantas/ Rex.
Bonza have indicated they will fly out of Mildura on their 737’s so it will be interesting to see the passenger numbers.
AgentGerko
says:Before everyone starts to argue that Rex is not allowing competition, let’s remember who international competition was before Qantas started bullying. Alitalia, Air France, Olympic, Lufthansa, KLM, AOM and Virgin Atlantic are just a few of the Euro carriers pushed out of Australia by Qantas, to the point where BA is the only European carrier bringing its own metal to Australia, and with them its more a pride thing than profit. QF loves nothing more than muscling out the competition and then, having done so, usually reduces its own capacity. Once upon a time just about every decent sized regional town in Oz had an airline service. Qantaslink would be quite happy to see the back of Rex and then they could further pick and choose the places they’d offer some kind of service to.
Ken
says:If Sharp is so concerned about Qantas moving in to what he sees as Rex only routes, then why on earth did he start competing on the Capital city routes. Me thinks he will soon have to report financials to the Singapore owners and he needs some sort of excuse for what is clearly “bad management” If you join the big boys then you need to accept they will respond.
Vannus
says:So well said, Ken.
Adrian above, said the same view.
Sharp is beyond a joke, & it’s amazing Rex’s billionaire Singaporean owners’ put up with his constant verbiage against QANTAS.
Feel sure it’s lost his airline plenty of customers’, as it’s continuous, & after all, QANTAS is our National Carrier, who does much humanitarian work during times of disasters’, here, with neighbouring Pacific nations’, & overseas.
When Rex’s financial figures are released at end FY21-22, wonder if his mouth will be flapping then?
Craigy
says:Sharp (not the sharpest airline executive in the world) says he doesn’t see how AJ can look at himself in the mirror. Well from my observations, Sharp can’t look at himself in the mirror because it isn’t a very pleasant sight.
Nicholas
says:Not to late to create a new Category in the Aviation Awards for the year.
“Whiner of the Year”
No need to call for nominations as Sharp will win by a country mile……
Andy
says:AgentGerko, those European carriers fell victim to the hub carriers from Asia and the Middle East, with their superior on board service, newer and better aircraft, clever scheduling and lower costs. Think Singapore, Emirates, Cathay and others. Qantas had little to do with it – in fact over the same period their European offering was alsodecimated having been equally unable to compete, and therefore withdrawing Qantas operated aircraft from routes like Frankfurt, Paris, Rome, Athens, Amsterdam, Manchester and Belgrade.
Neil
says:John Sharp is very hard to follow. He carries on if Qantas enters a regional destination that Rex have been flying to for so many years,& hates the competition, yet is quite happy to fly his second-hand Boeing 737 800s on the triangular Brisbane/Sydney/Melbourne, Surprise! ,Wants the Competition,& tells you how great his airline is, even if they are half full. The travelling public are the Big losers unless we have proper Competition. I would be worried about his aging fleets of Saabs vs Dash 8.vs 16 year old 737 vs Qantas with their upcoming fleets of Airbuses.