Aviation

“A classic Rex tantrum”: Qantas hits back at criticism of its regional strategy

Huntley Mitchell

Huntley Mitchell

Qantas has returned serve after being criticised by rival Rex over its “aggressive, predatory moves” on regional routes.

As it prepares to take on Qantas and Virgin Australia on domestic routes from next month, Rex announced yesterday that it will embark on a major revamp of its regional route network in response increased competition by the flying kangaroo since the COVID-19 pandemic.

While standing its ground on routes that Qantas has encroached on, Rex has decided “with a heavy heart” to scrap its Sydney-Bathurst, Sydney-Cooma, Sydney-Lismore, Sydney-Grafton, and Adelaide-Kangaroo Island services once the federal government’s Regional Airline Network Support program is discontinued at the end of March.

“Qantas has clearly embarked on a deliberate strategy of moving into Rex’s routes that can only support one regional carrier in an attempt to intimidate and damage Rex in its traditional regional market, hoping that Rex would be a less formidable competitor in the domestic market,” Rex deputy chairman John Sharp said.

“Qantas is making record losses during COVID and has received an estimated $1.2 billion in Commonwealth assistance to stay solvent, but despite this, feels it is appropriate to use taxpayers’ funds to finance the losses on new services whose sole objective is to weaken the competitor.”

However, Rex will start operating on the Sydney-Coffs Harbour and Sydney-Port Macquarie routes from April following Virgin Australia’s retreat from these ports.

The airline is also considering the addition of Sydney-Tamworth, Perth-Geraldton, Melbourne-Devonport, and Sydney-Canberra services.

Rex is also calling on the Australian Competition & Consumer Commission to take enforcement actions against Qantas over its “predatory” behaviour.

In response, QantasLink CEO John Gissing described the criticism towards the flying kangaroo as “a classic Rex tantrum”.

“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,” he said.

“The fact is Rex is receiving millions of dollars in bespoke government assistance for its regional operations at the same time as it’s acquiring new aircraft to fly between capital cities.”

Gissing said it appeared Rex was trying to blame Qantas for other challenges the airline may be having.

“We don’t start routes if we don’t think they will be commercially viable for us,” he said.

“We know that extra capacity and lower fares increases overall travel demand, which is good news for the regional communities we will be operating to.

“We’ll be reviewing our network and consider whether we can offer services on any of the routes that Rex is threatening to pull out of.”

QantasLink CEO John Gissing (image source: YouTube/Bombardier)

Gissing’s comments come shortly after Qantas revealed it will add three new routes and extra seats to the NSW north coast to support growing demand for holidays in Australia.

From 1 April 2021, Qantas will begin Melbourne-Coffs Harbour, Brisbane-Coffs Harbour and Canberra-Byron Bay (Ballina) flights, as well as adding 500 extra seats on the Sydney-Coffs Harbour route each week, along with the option to travel in business class.


Featured image source: iStock/Ryan Fletcher

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