In a latest development, the Australia's aviation landscape is shifting as Regional Express Holdings (Rex) has entered voluntary administration. With this recent move, as per multiple reports, it is expected to have a significant job losses and a shakeup in the regional air market. This also follows with the recent collapse of the budget airline Bonza.
Aviation Market Shake-Up
Rex which earlier focused on regional routes across Australia, later expanded its presence into the competitive 'golden triangle', that is, the high traffic route between Sydney, Brisbane, and Melbourne.
But after significant effort, the airline struggled to challenge the dominance of other major player in the aviation market which included the Qantas Airways and Virgin Australia, which in together controlled over 90 per cent of the market as of March, added various reports.
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Rex Airlines, Australia's third largest | Representative Image
The reports added that, on Tuesday (July 30), the airline appointed administrators Ernst & Young. Followed by this, the administration is anticipated to see the end of Rex's Boeing 737 flights between major cities, which could result in 360 job cuts from this division alone.
In addition to this, around 250 more positions are projected to be eliminated in other areas.
Challenges for Regional and Smaller Airlines
Apart from this recent job cuts in Rex, there are also other challenges faced by other airlines. Just three months ago, the budget carrier, Bonza also ceased operation.
This also highlights about the challenges faced by the smaller airlines in a market dominated by Qantas and Virgin Australia.
With Rex grounding its major city flights, the future of the airline remains uncertain.
However, there are also speculation that Asia-based private equity firm PAG, which supported Rex’s expansion, might step in as a potential new owner.
