Rex takes on Qantas with new Melbourne-Devonport service

“The economics are evident and we believe we’ll be carrying more than twice the number of passengers to Devonport than we did to Albury with the same amount of resources deployed,” Rex deputy chairman John Sharp said.

Tuesday’s news marks the latest move in an ongoing back-and-forth battle between the two airlines over network expansion, as both airlines increasingly encroach into routes previously only serviced by its rival.

A Qantas spokesperson told Australian Aviation: “Unlike Rex we welcome competition on the routes we fly.

“Just as we have for decades, we’ll continue providing a high quality service to the people of Devonport with all-inclusive fares and lounge access for Frequent Flyers.”

Meanwhile, Sharp said, “This new Rex route Melbourne to Devonport carried pre-COVID close to 150,000 annual passengers and we have been courted by the local community for over two years because of the price gouging by Qantas, the sole carrier on the route, and because of the very poor service levels,” Sharp said.

“We did not respond earlier to the pleas of the community as we had limited resources then and we wanted to give priority to our existing network.

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“Qantas’ predatory attacks on Rex’s network mean that we no longer can support the marginal routes and we need to channel our resources to the biggest regional routes where the financial returns are much better.”

Rex said the new route is its third service into Tasmania, with tickets due to go on sale later this month.

It comes just two weeks after Rex scrapped seven routes from its network, laying the blame largely on Qantas’ “predatory” behaviour in the market. The airline said these decisions will allow it to “improve” its balance sheet.

“We will be ramping up significantly our services in the biggest regional routes and at the start of the new financial year our regional capacity will be higher than pre-COVID levels,” Sharp added.

Last month, Rex announced it will withdraw all services from Bathurst, Grafton, Lismore, and Kangaroo Island on 30 June, when federal government subsidies under the Regional Aviation Network Support (RANS) program ceases. The airline will also exit from Ballina two days later, on 2 July.

“Rex has faithfully serviced most of these routes for 20 years, and some of them for more than 30 years by Rex’s predecessors Kendell and Hazelton,” Sharp said in a statement.

“So it is with a really heavy heart that we have to announce the cessation of services in an effort to improve Rex’s financial performance.”

The airline had previously also withdrawn from its Sydney-Canberra and Melbourne-Albury services.

“Qantas’ well-publicised predatory actions on Rex’s regional routes have meant that Rex no longer has the ability to cross-subsidise these regional routes,” Sharp added.

A Qantas spokesperson said Rex’s latest claims are “just ridiculous” and added that “Rex’s standard approach whenever it withdraws from a route is to blame Qantas”.

In retaliation, Qantas later set up a dedicated webpage to debunk what it called “false claims” made by Rex.

“Rex’s claims against Qantas have become so far-fetched, we had to create a dedicated page on our website to rebut them and update it on a fairly regularly basis as they cook up more weird conspiracy theories,” a Qantas spokesperson told Australian Aviation.

On the new web page, and speaking of its rival’s most recent decision, retorted: “Rex blamed Qantas, despite the fact that Qantas operates on only two of these routes (Kangaroo Island and Ballina) and Rex is the sole operator on the other three routes.

“This is just the latest example of Rex blaming Qantas and others for decisions that by its own admission it has made ‘to look after itself’.”

Qantas also pointed to the fact that the ACCC has said it will take “no further action” in an earlier investigation into Qantas’ alleged anti-competitive behaviour after Rex made a formal complaint.

“The Qantas Group has launched more than 50 new domestic and regional routes over the past two years, only 10 of which have been operated by Rex,” Qantas said.

The airline said it will continue to update the webpage “to correct further false claims from Rex”.