Rex pulls the plug on Sydney-Canberra flights

Competitive pressure forces Rex Airlines to withdraw from the popular business route.

By Matt Lennon, May 24 2022
Rex pulls the plug on Sydney-Canberra flights

Barely a year – one year, one month and 11 days, to be precise – after introducing flights between Sydney and Canberra, Rex Airlines is axing the route, blaming its decision on competitive pressures and high charges taking effect from June at Sydney Airport.

The final service between the two cities, popular among business travellers and government officials, will take off from Sydney on 29 May 2022.

Rex says it will then divert resources to routes which will provide “a better return”.

Deputy Chairman, John Sharp, maintains he was pleased the airline was able to serve the Sydney-Canberra corridor as part of Regional Express’ expansion into capital city trunk routes.

“We are proud to have brought much needed competition to the Sydney-Canberra route and airfares have never been cheaper,” he said.

From the outset, Rex offered seven return flights between the two cities each day with one-way fares starting from $99 on its 33-seat Saab 340B turboprops. This was complemented by the opening of its own lounge at Canberra Airport.

Its ambition was to eventually scale this up to the larger Boeing 737 jets on morning and afternoon peak services, which offered eight seats in business class and 168 in economy and to compete with Qantas on what was at the time a monopoly route.

Rex cites competitive pressure as its reason for exiting the Sydney-Canberra route.
Rex cites competitive pressure as its reason for exiting the Sydney-Canberra route.

Virgin Australia resumed its own services between the two cities in January 2022, flying up to 53 times weekly using similar Saab 340B Plus aircraft from regional carrier Link Airways.

Melbourne-Albury also bites the dust

The withdrawal by Rex is its second in the space of a week, with 29 May also marking the end of direct services between Albury and Melbourne – a route it has served for 39 years.

Sharp lay the blame for the axe falling on Albury directly at the feet of Qantas and what he described as “illegal predatory behaviour to drive out competition in a war of attrition, knowing that its competitors do not have the balance sheet to lose money indefinitely.”

“Sadly for the community, we will soon see Qantas providing only a token service once it sees that it has achieved its objectives,” Sharp added with an acid tongue.

In response, a Qantas spokesperson noted “Rex’s standard approach whenever it withdraws from a route is to blame Qantas.”

Noting that Qantas has also launched services from Albury to Brisbane and Adelaide in the past two years, neither of which are serviced by Rex, along with an uptick in Brisbane-Albury flights, the airline said it sees “strong growth potential in the region and have launched three new routes to and from Albury in the past two years, only one of which was also serviced by Rex.”

“Rex’s idea of competition is that it’s something that happens to others, because they believe they have an enshrined right to be the only carrier on some regional routes. The reality is that Qantas services have been welcomed by regional communities as providing competition and flexibility.”

24 Oct 2010

Total posts 2547

Readers are reminded to keep comments on topic and add value to the article and other comments. Discussions on politics can be kept for your own social media channels.

24 Aug 2011

Total posts 1102

Once VA entered onto SYD-CBR using its LINK partnership, ZL was always going to struggle to sustain anything approaching sufficient demand.

 It is probably good that they have been realistic and withdrawn rather than struggling on in a losing battle.

QF

11 Jul 2014

Total posts 786

Wonder what would happen if REX and Virgin Teamed Up? REX and Virgin are a good fit, just need the cash to buy REX out......

24 Aug 2011

Total posts 1102

There is no indication that VA has any interest in buying ZL.  VA doesn't need the jet operation which adds nothing to what they already offer and the regional operation needs extensive capex in the next few years as the Saabs come up to retirement.  

If Bain wanted to buy ZL they could easily come up with the cash but they have no reason to bother.

QF

11 Jul 2014

Total posts 786

From the paperwork I've seen the Bain is Regional routes, forget about the jets who cares about REX Jets.


Hi Guest, join in the discussion on Rex pulls the plug on Sydney-Canberra flights