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Concerns have been raised about the progress of Air T’s rehabilitation of Rex, with additional aircraft yet to be returned to service.
The American firm, which purchased Rex out of administration late last year, pledged to return an additional 14 of Rex’s Saab 340B aircraft to the skies; however, despite drawing on $26.7 million of a $60 million loan from the Federal Government, it has yet to appreciably raise the number in operation.
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According to data provided by Rex to the Government, the airline currently operates 30 Saab 340Bs – around the same number as it had in the air when Air T took over – on 15 routes as the sole operator, 13 contested routes, and 11 routes regulated by the WA and Queensland Governments.
In a statement, Transport Minister Catherine King said the Rex sale was “a positive development in keeping regional communities connected”.
“The new Rex management have continued to work cooperatively with the Department following its emergence from voluntary administration,” she said.
“This has been particularly important as Rex, like the rest of the airline industry, have had to respond to heightened fuel costs caused by the war in the Middle East.”
Australian Aviation understands that the carrier repaid interest of $367,857.53 on 2 July under the Commonwealth Support Package. Air T’s bid for Rex last year was successful owing in part to its access to parts for the ageing turboprop aircraft.
“Many of Rex’s Saabs are over 30 years old and part of the appeal of Air T’s bid for Rex was their expertise in servicing aircraft, engines and parts,” said Minister King.
“Supply chain constraints have slowed down Rex Airline’s Engine Care and Maintenance Program, but we continue to monitor progress against agreed commitments.
“The Australian Government remains committed to seeing regional areas served by a healthy aviation sector. The Government retains its security over all of Rex’s aircraft and simulator.”
Rex has cut back on several routes since the Air T takeover, including Orange and King Island services, while the Government has helped fund airports owed money from the collapse.
Speaking to The Australian, Rob Walker, CEO of the Regional Aviation Association of Australia (RAAA), said costs in regional aviation are high, with “exorbitant prices” for spare parts especially of concern for members.
“It’s also very much around the challenges of an ageing fleet. There are no real alternatives yet for many of our member operators, and even if there was an option to acquire younger aircraft it’s a difficult environment to be sourcing finance,” he said.
“We’re not looking for handouts or cash but there are things the government could do in terms of what we describe as our regional aviation investment fund, where they could use revenue they already collect to provide loan assistance or loan guarantees.”
Rex has been contacted for comment.
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