Australia’s third largest airline enters administration

• Australia’s third largest airline enters administration and cancels flights on key routes
• Specialising in regional travel, Rex serves smaller towns and cities not covered by larger carriers
• Ernst & Young Australia has been appointed as the administrator after trading in Rex shares was halted earlier this week
• It follows the recent collapse of another Australian airline, Bonza, highlighting the challenges in the domestic aviation market

Australia’s third largest airline enters administration

Australia’s third-largest airline, Rex Airlines, has entered voluntary administration and cancelled flights on several key routes. Specialising in regional travel, Rex serves smaller towns and cities not covered by larger carriers like Qantas and Virgin Australia. Ernst & Young Australia has been appointed as the administrator after trading in Rex shares was halted earlier this week.

This development follows the recent collapse of another Australian airline, Bonza, highlighting the challenges in the domestic aviation market. Founded in 2002 after the collapse of Ansett, Rex operates a fleet of 66 aircraft, including 34-seater Saab 340 planes and nine Boeing 737-800s. The airline had expanded to include routes between major cities such as Melbourne, Sydney, and Brisbane, but these flights have now been cancelled, and the 737-800s grounded.

Passengers with bookings on the affected routes will not receive refunds but can rebook with Virgin Australia at no extra cost. However, regional services using the smaller Saab planes will continue.

Flights have been grounded as Rex Airlines enters voluntary administration. Reporter @georgiacosti has more.

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Opposition transport spokeswoman Bridget McKenzie expressed concern over the lack of competition in Australia’s aviation sector, noting that Qantas (which also owns Jetstar) and Virgin Australia dominate over 93% of the market. She emphasised that companies like Rex provide necessary competition, leading to more affordable airfares.

Rex shares have dropped by about half over the past year. The company also holds a 50% stake in a business that services remote worksites, such as mines. This news comes months after Bonza, a low-cost carrier, went into administration, resulting in the grounding of its fleet and the loss of over 300 jobs.