Rex in voluntary administration, ending all 737 services

[henrus]

Certainly makes sense why John Sharp lead a coup to remove Lim Kim Hai as chairman. Seems like Lim was rather crazy.

Over the years we saw some wild statements from Sharp as well. I’d argue that Rex’s demise was too many big voices at the top with differing opinions.

 

[flyer89]

LKH has been known to be a malignant personality within the industry for many years. Then again, the industry is full of them.

 

[justinbrett]

QantasLink - likely will be blocked by ACCC.

I think you’re missing the core concept of what a government subsidised route is.

 

[burmans]

It was an opinion piece designed to get clicks. I don’t think anybody with any industry knowledge gave it any credit.

It just seems to be the same members brining it up in every thread and it results in moderators locking them. It’s not on topic.

Same members or same member?

 

[dajop]

I think you’re missing the core concept of what a government subsidised route is.

Yes, exactly. Essentially don't the government just put these routes out to tender periodically?

Whether it is Rex, Qantas, Link or someone else it is not a matter for ACCC. By definition these routes are non-compete routes, because they need subsidiies to support just a single carrier on the route.

 

[jakeseven7]

Certainly makes sense why John Sharp lead a coup to remove Lim Kim Hai as chairman. Seems like Lim was rather crazy.

Takes one to know one I guess. Think Mr Sharp had a few loose parts too

 

[RSVKanga]

Could EY approach EY and become a potential buyer/investor for Rex? Pun aside they are already partner airlines.

 

[p--and--t]

Could EY approach EY and become a potential buyer/investor for Rex? Pun aside they are already partner airlines.

Willing to bet - won't happen.

 

[HS-TQE]

If it was Borghetti's BFF Hogan still at the helm, EY would've had been interested

 

[Saab34]

Considering Rex had earnings around the $10m mark in its Saab days, they are not exactly numbers the big players waste their time on.

The fact PAG has injected further funds during this process, plus the cash they have already blown, I can’t see anyone else picking this up.

 

[CaptJCool]

Just read that staff might have to wait months for payment and redundancy payouts? If that’s the case, it’s disgraceful. Workers should have wages protected!

FEG (fair entitlement guarantee) ought kick in and provide unpaid wages and leave

Fair Entitlements Guarantee - Department of Employment and Workplace Relations, Australian Government

A legislative safety net scheme of last resort with assistance available for eligible employees.

www.dewr.gov.au

 

[Quickstatus]

I think you’re missing the core concept of what a government subsidised route is.

Are all ZL flights subsidised?
Last I saw the ACCC is a federal govt entity, and the subsidies where it exists are a State Govt initiative.

 

[MEL_Traveller]

FEG (fair entitlement guarantee) ought kick in and provide unpaid wages and leave

Fair Entitlements Guarantee - Department of Employment and Workplace Relations, Australian Government

A legislative safety net scheme of last resort with assistance available for eligible employees.

www.dewr.gov.au

That’s a small bit of comfort for the workers. But what about the tax payer?

If this insolvency had been one day later, payroll would have run? The taxpayer might have had the blow softened.

While my thoughts are foremost with the workers, I can’t help feeling that there’s a real lack of transparency. At some stage before the collapse there must have been some inkling at head office that things weren’t going right.

Why weren’t the travelling public informed? We continued to spend money and yet someone, somewhere, was aware that we might lose that money, or benefits arising out of that spend (like FF entitlements).

Something needs to change.

 

[tmdl]

Could EY approach EY and become a potential buyer/investor for Rex? Pun aside they are already partner airlines.

Would be nice

 

[justinbrett]

Are all ZL flights subsidised?
Last I saw the ACCC is a federal govt entity, and the subsidies where it exists are a State Govt initiative.

The comment you replied to was talking about those routes specifically.

If ACCC has even a fleeting interest in a route it should not be getting subsidies. It doesn’t matter what level of government is subsidising it, you’re missing the whole point if you think that ACCC looks at subsidised routes.

 

[Quickstatus]

The comment you replied to was talking about those routes specifically.

Sure, but my comment was a more general comment that a takeover by QL could make the ACCC a bit twitchy

 

[RooFlyer]

Seems REX was months behind in its payments to airports. I guess, as with Bonza, the signs were there if anyone was looking.

Rex was months behind payments, as ratepayers left to foot bill

Regional Express was months behind on its payments to airports and other suppliers before it went into administration and ratepayers will have to foot the bill for out-of-pocket local councils.

Murray Wood, chief executive of the Dubbo Regional Council in central NSW, said Rex’s administrators at EY will only pay airports from the date of their appointment on July 30.


Dubbo Regional Council CEO Murray Wood says Rex has left unpaid bills.

“But anything up to then is not going to be paid. They’ve been trading insolvent, effectively,” Mr Wood said on Thursday.

Rex is believed to have left about half a million dollars in unpaid airport fees at Dubbo. Mr Wood said the airline usually ignored the 14-day payment terms set by the city.

There are other councils named in the story - Albany.

A separate snippet from the AFR is that EY were brought in by PAG to conduct a "strategic review" and paid $500K.

“EY’s advice was limited to preparation of a template financial model for management to develop inputs and assumptions and assessing the company’s financial position and the consequences of insolvency and restructuring options,” the consultants said.

“Our work involved the building of the mechanics of the financial
model only. We did not have any input into the assumptions that underpinned the financial forecasts in the model or nor did we express any opinion on the achievability of the forecasts.”

EY says that that previous work does not compromise its appointment as Administrator, which has to be independent.

 

[justinbrett]

Sure, but my comment was a more general comment that a takeover by QL could make the ACCC a bit twitchy

So you completely missed the point of the post you replied to.

 

[Quickstatus]

So you completely missed the point of the post you replied to.

Ah no, I was making a more general comment about takeover of Rex

 

[justinbrett]

Ah no, I was making a more general comment about takeover of Rex

Nobody in their right mind has suggested a QF takeover.