Regional Express has welcomed Thursday's announcement from the Australian Competition & Consumer Commission to continue to allow Rex, Qantas and Virgin Australia to cooperate on 10 competitive regional routes under a draft authorisation.
Rex said they put forward the initiative for collaboration on regional routes which include Townsville to Mount Isa.with an application to the ACCC in mid-March, as the industry faced an overwhelming downturn in travel demand arising from the COVID-19 pandemic.
The application sought permission from the ACCC for Rex to coordinate flight schedules with QantasLink and Virgin Australia on 10 regional routes to ensure maximum efficient use of resources amidst the disastrous operating conditions.
Rex gave an undertaking that ticket prices will not be higher than they were in February 2020 before the the pandemic.
This new draft authorisation will be valid till June 2021 and will grant the three carriers the same rights as in the interim authorisation.
Rex Deputy Chairman John Sharp said in normal operating circumstances such an approach would be anti-competitive, however passenger traffic is only about 15% of before the pandemic, with some destinations down to almost 2% due to border closures.
"The most important priority now is to keep regional air services alive and the authorisation to collaborate will ensure that the services could be carried out in a sustainable manner," Mr Sharp said.
"Safeguards have been built into the draft authorisation to ensure that ticket prices remain unchanged with the collaboration.
"Rex will again reach out to QantasLink to request their agreement to collaborate. Virgin Australia is no longer present in any of the 10 competitive routes in question."
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