Regional Express will adopt a mid-market model for its direct flights between Sydney, Melbourne and Brisbane, although the airline intends to retain the business class seats of its ex-Virgin Boeing 737s.
The positioning will see Rex stake out largely the same turf which Virgin Australia will target under new owners Bain Capital.
However, several blanks in Regional Express playbook are yet to be filled in, and may not take shape until Virgin reveals its revised ‘customer experience’ proposition in the coming weeks.
Six Boeing 737s, all previously leased to Virgin Australia, will form Rex’s launch fleet.
Beyond the triangle...
The ambitious assault on Australia’s lucrative ‘golden triangle’ between the east coast capitals could later extend to Canberra, Adelaide and Perth, according to the airline’s investor deck for what it termed Project Mother.
“If our (triangle) services prove successful, we will inject up to 10 aircraft into the domestic market by the end of 2021,” says Rex Deputy Chairman John Sharp.
“From there, we intend to develop a full domestic airline network, linking all the capital cities over time.”
While Rex’s Project Mother documents sighted by Executive Traveller gave the capital city service the cumbersome tag of being an ‘LCC ++ hybrid airline’, Sharp simplifies this by saying “I think we'll be somewhere in the middle.”
“Technically what we've been offering as a regional airline is a full-service airline,” Sharp tells Executive Traveller.
“Our ticket price includes a certain amount of checked luggage, and also catering on board, if it’s tea or coffee or a drink of some sort and a snack… we don't charge extra for that.”
“We'll probably carry that same level of service across into the domestic airline, which will sort of position us between a low cost carrier and a full service legacy airline, but the final decisions have not been made yet.”
Sharp confirms that Regional Express will retain the eight business class seats of its ex-Virgin Boeing 737s, with the Virgin branding removed of course.
“There'll have to be some modifications to the leather upholstery which has an embossed Virgin logo, but that’s not a very difficult thing to do.”
But how those seats will be marketed is another TBA: Rex could promote them as a conventional business class offering, to square up against Qantas and Virgin Australia, or as more of a ‘premium’ cabin where the sole differentiator against economy would be comfort and legroom.
“It could be any one of those, that’s yet to be decided,” Sharp admits.
Helping Rex’s fare stratification in the main cabin will the retention of Virgin’s five rows of 30 extra legroom Economy X seats.
Access to Rex’s airport lounges at Sydney, Melbourne and potentially Brisbane – Sharp confirms discussions are underway with Brisbane Airport Corporations – could be included with those 'business class’ tickets and even on some economy fares.
“We're looking at whether there's any free access to the lounges for certain types of ticket in economy and business, as a complimentary part of the package,” Sharp says.
The annual lounge membership program, for which travellers pay $329 per year, will also continue.
Sharp also confirmed that Rex was considering a frequent flyer scheme, but this would come well after the launch of capital city flights.
“Frequent flyer programs are good, they’re usually the most profitable part of an airline operation, so we certainly don't rule out having one,” Sharp tells Executive Traveller.
“But we want to take things one step at a time, we don't want to spread ourselves too thinly. So our focus will be on getting the airline up and running, and getting it to work properly before we take on any more tasks.”
“And when we've got that bedded down, we will then look to do things like the frequent flyer program and other initiatives.”