Regional airline Rex plans to launch flights between Sydney, Melbourne and Brisbane from 1 March 2021, using an initial fleet of between five and ten single-aisle jets and adopting a similar hybrid model to the rebooted Virgin Australia.
The airline says its has "formed the view that Rex could successfully embark on domestic operations" and that it will "commence preparations in earnest for the operation of an initial fleet of five to ten narrow-body jet aircraft to be based out of Sydney and/or Melbourne to service the golden triangle (Sydney-Melbourne-Brisbane)."
The targeted start date of 1 March 2021 is "subject to fund availability and regulatory approval", and locks down plans first floated in May 2020, albeit on a grander scale, with a $200m warchest for ten jets covering not only the east coast capital cities but also the transcontinental trek to Perth.
All the same, even this more modest program for the three-city market will mean new competition to both Qantas and Virgin Australia.
Rex says its capital city flights "will be priced at affordable levels but will also include baggage allowance, meals on board and pre-assigned seating. Booking channels will include both Rex direct and Global Distribution Systems (GDS). Lounge membership will be available for subscription."
Rex will seek to lease jets from either the Airbus A320 or Boeing 737 series, and expects that the current depressed state of the air travel market, these jets would be available at very attractive rates.
The airline said it will adopt a hybrid model, which is more likely to include a 'premium' cabin rather than business class.
This could follow the European business class model where the middle seat in a 3-3 layout remains free – and is perhaps dressed with a temporary plastic shroud, similar to what's done on British Airways' Club Europe services – along with a little extra legroom or recline compared to other economy seats.
Rex Deputy Chairman John Sharp, in announcing plans for the east coast capital city service, said with the airline's "expansive regional network of 60 destinations, existing infrastructure in all these capital city airports, superior efficiencies and unbeatable reliability, it will simply be an incremental extension for Rex to embark on domestic operations especially since one out of every ten flights in Australia was already a Rex flight during the pre-COVID days."
Rex estimates the launch of "limited domestic operations" between Sydney, Melbourne and Brisbane will require "a minimum of $30 million," and flagged that it has already received interest from lessors willing to provide $30 million against 15 of Rex’s fleet of 60 unencumbered Saab 340 aircraft.
In addition, Rex has signed a Memorandum of Understanding with manufacturer ATR to "replace and modernise" its current Saab 340 fleet with ATR42 and ATR72 turbo-props, which the airline said "will deliver lower cost per seat and increased revenue and profits."