Regional Express (Rex) has stuck its chin out against Qantas saying it is committed to Merimbula and wouldn't be scared off by the entry of Qantas into a number of regional destinations.
The two airlines are squaring up after Rex announced its domestic expansion aiming at services between major centres and Qantas started moving into regional destinations including Merimbula.
Speaking at Merimbula Airport on Friday morning, February, 5, the deputy chairman of Rex, John Sharp said the airline would continue to service Merimbula after an earlier decision to withdraw following Qantas' announcement of flights between Merimbula and Sydney.
Mr Sharp said the change of plans was due to "council agreeing not to charge the airline for the extra security costs that could be triggered by the entry of Qantas on the route, as the latter's larger aircraft would be above the exemption threshold for security screening".
Qantas is not subject to screening for the current 50-seater aircraft flying out of Merimbula.
Mr Sharp took aim at Qantas saying it was trying to undermine Rex and its network by moving into a number of its destinations.
"All of those destinations will not sustain two operators, are hardly viable for one. Clearly Qantas is going to lose money and are prepared to lose money," Mr Sharp said.
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In a complete turnaround from recent years, in relations between the airline and council, Mr Sharp said that because of the help and co-operation of council and the mayor, Russell Fitzpatrick, Rex was confident about continuing its services to Merimbula.
By March it is believed that both airlines will be servicing the Sydney and Melbourne routes. Rex has five flights to Sydney and four to Melbourne each week. Qantas is flying to Sydney but is expected to announce a Melbourne service starting in March.
"We're not concerned about the competition from Qantas so much, we know in every one of the destinations they've moved into they're not making money. It's just a tactic to scare us off from our domestic expansion but we know it's costing them a lot of money. It's a question of time before they go away. In places like Merimbula where we've had a relationship for 20 to 30 years, we'd like to maintain that relationship," Mr Sharp said.
Asked about passenger numbers, Mr Sharp said that passenger numbers in Merimbula were "quite satisfactory" and he expected to see them increase as COVID issues lessened. But he maintained that Merimbula could only sustain one airline.
"It will only be a matter of time before Qantas departs. No airline can continue to lose money. We believe they are burning about $40m a month," Mr Sharp said.
He said the actions of Qantas "are not about servicing the community; it's predatory competitive behaviour," Mr Sharp said.
"Rex has always been profitable and is far stronger financially," he said.
The mayor, Russell Fitzpatrick, said that Rex was a key part of the tourism and business network and that this latest commitment was very welcome news for travellers and business owners alike.
"As we all know, these are difficult times for tourism and local business, and having stable and secure passenger services is vitally important for bringing investment to the shire," Cr Fitzpatrick said.
Rex said it's community fares would remain available at $129 on both the Merimbula to Sydney and Melbourne routes.
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