When Rex expanded its operations into the Golden Triangle routes between Sydney, Melbourne and Brisbane, it knew it was an ambitious plan.The Sydney-Melbourne route is one of the most lucrative in the world and delivers our two biggest airlines, Qantas and Virgin, with more revenue than any other.
Analysts believed Rex was more exposed than other airlines because it was the newest entrant to the capital city routes. Hundreds of staff have since been formally notified of their termination as administrators dig through the company's financials to get a clearer idea of the airline's profitability.
In the 1990s, Compass, the country's third largest carrier at the time, retreated from the skies, never to be seen again.Administrators overseeing Rex Airlines have told hundreds of employees they are unlikely to receive their wages or redundancy payouts for "months", and expect the domestic aviation business will cease operating by the end of the day.The list of other victims in the sector goes on and on.
In order to operate along a particular route, carriers need to secure a take off or landing time at the airport. The more popular the route, the higher the demand for slots, particularly at peak times. Rex and others accused Qantas and Virgin of scheduling more flights than they intend to run, before cancelling them in a strategic manner
"Airlines can exploit the scheme by acquiring and hoarding slots for strategic reasons, such as to prevent competitors' access to slots, resulting in inefficient slot use and further diminishing opportunities for increased competition. Deloitte's Vaughan Strawbridge, John Greig, Sal Algeri and Richard Hughes were brought in as voluntary administrators in what becameWhile VA continued to operate its scheduled international and domestic flights, it was burning $200 million a month and quickly running out of money.Bain Capital's winning bid ticked most of the criteria required for a new owner, including guaranteeing the airline would continue and that it would honour its creditors.
For many, it would only be through the media that the 2,000-strong workforce learnt their employer had been placed into administration at 9:30pm on Tuesday.By the next morning, employees of Rex Airlines — its now-defunct capital city operations, known amongst staff as its "domestic", "jet", "737" business or "RAL" — followed the Microsoft Teams link sent to their personal emails for their meeting with EY administrators at 8am.
A crew member asked for someone from upper management to attend so they could answer questions about how long they knew the business was in trouble for.In the end, no-one from upper management ended up attending the second meeting.The consultation period for the 737 staff was ultimately extended until 4pm on Wednesday, with the first termination letters sent out two and a half hours later.
It will be another week until the airline's former employees, who are now creditors of the business, know what happens next. A number of crew still working in the regional arm of the airline, who are not authorised to speak publicly, have told the ABC that several staff are looking to leave the company altogether, horrified at the way their colleagues have been treated.Many have privately expressed concern for the wellbeing of their colleagues.
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