Rex to fly between Australian capital cities

Saab34

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They are still aiming to have 30 737’s in the coming years so I can’t see them backing out just yet
Tiger wanted 30 also.
A seventh new aircraft will arrive from France in September and Roberts is hoping 30 of the 50 planes Tiger has on order will eventually help her expand Tiger's presence in Australia.

I’d be interested to know what the cash burn here is at the moment. Crude $110-$120 is pretty grim for the balance sheet assuming they are unhedged. At those levels running an average load of 30 bodies, back of the coaster calculation would be $1m a week loss.

Nothing seems to be improving (possibly going backwards) so doubling the fleet to 10, you don’t really get much in the way from scale with crude so high, so $100m a year burn? Total costs will soon start to blow out once they start adding more aircraft, engineering/staff/lease costs start to balloon.

Tiger lost a billion dollars from 2007-2020. Who knows when the tap gets turned off here, another $100m might be poured in, won’t last long though.
 

HS-TQE

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With the incoming ALP government, it'll be interesting to see how the subsidy arrangements between REX and the government for regionals services will work going forward.

I can't see the 'tap' being left on for much longer as there's likely to be 'stipulations' put in such as the 'subsidy must be used for regional routes' which may address the 'allegations' of those subsidies being put towards their 'RexJet' subsidiary.
 

Melburnian1

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On Thursday 2 June 2022, ZL117 (1400 hours SYD - MEL) had six in J and 106 in whY, so reasonable occupancy. With economy class fares that can be $79 one way on Tues/Wed and $99 on some other days, very possible if one includes overheads that the flight is lossmaking.
 

Saab34

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They have cancelled a whole heap of flights this week which would explain the heavier load. I have a family member who thought they would give them a go, both flights this week got cancelled and combined with other flights. Opted for a refund and booked virgin for the same price regardless, didn’t cost her a cent more.
 

HS-TQE

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I wonder what happened to the status of the 7th and 8th 738s that ZL were meant to get last year? Per the press release, this didn't eventuate.

From late June 2021:
Rex today announced it had signed a Letter of Intent (LOI) with a lessor for the lease of two Boeing 737-800NGs. The two aircraft are expected to arrive in late August, increasing the 737 fleet to eight, and are scheduled to enter service on Rex’s domestic network in September.

Source: https://www.rex.com.au/BlobViewer/B...5373153466C50783878325836716F6830516652413D3D
 
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dylarr

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There was an article The Australian from a couple of days ago on Rex's struggling jet operation. Sorry it's behind a paywall if you want to read the entire article. Essentially the reporters did some analysis of loads, presumably from EF or similar source across a few days.

Some excerpts:

Over four days, The Australian monitored passenger levels on 35 of 58 Rex flights between Sydney, Melbourne, Brisbane and the Gold Coast. The analysis shows many of those – tracked Monday to Thursday last week – had few passengers. Twelve, with fewer than 44 passengers, were less than one quarter full. One flight, from Sydney to the Gold Coast, appeared to have fewer than 10 passengers. Only three, two between Sydney and Melbourne and another from Melbourne to Brisbane, had more than 100 passengers.

And commentary from Sharp:

Rex Airlines deputy chairman John Sharp has conceded passenger numbers on its capital city routes – the key to the company’s expansion plans – “aren’t where we want them to be” even as the carrier exits an increasing number of regional destinations.

But Mr Sharp said the company was committed to growing the capital city services, launched in March 2021 with six Boeing 737-800NG aircraft, and was yet to spend half of the $150m of funds invested in the expansion by private equity firm PAG Asia Capital.

 
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