Rex financial woes in spotlight as airline employees face cuts and over 4000 creditors seek answers

The future of embattled airline Rex could begin to take shape at a first meeting of creditors as governments pore over the details of a potential taxpayer bailout.

The cash-strapped carrier’s more than 4000 creditors will meet virtually on Friday to grill its administrators about the dire state of the airline’s finances.

Five companies in the Rex group had administrators appointed on July 30, when the airline grounded its Boeing 737s on routes between major metropolitan centres.

Regional flights have continued while a buyer or financial lifeline is sought for Rex.

Nearly 600 jobs have been slashed, while Transport Workers Union national secretary Michael Kaine said a thousand more employees were keenly waiting for the outcomes of the administration process.

Of the 594 jobs lost, 343 were from the city arm of the airline with another 251 from the regional side.

Mr Kaine repeated calls for the federal government to take an equity stake in Rex to “give the community its seat at the table”.

“This is critical infrastructure that must be secured, hundreds of regional jobs must be protected, and governance must support the needs of the community, not just profits,” he said.

Friday’s first meeting will see creditors vote on a committee of inspection made up of representative creditors to assist in the administration process.

At a second meeting, a vote will be held to decide whether to return the Rex companies to the existing board, place them under a deed of company arrangement or liquidate them.

In NSW parliament on Thursday, Premier Chris Minns was asked why his government was yet to meet with administrators for Rex, which is headquartered near Sydney Airport.

Canberra has flagged it will back Rex as long as it prioritises regional flights, but no timeline has been provided on a possible bailout.

“I haven’t ruled out, and the commonwealth government hasn’t ruled out … taxpayer money being involved in that insolvency process,” Mr Minns said.

“We’ve made it clear that having Rex airlines linked with regional communities, in particular in NSW, is an absolute priority.”

Rex emerged from the collapse of Ansett in 2002 and offers passenger, freight and chartered flight services as well as flight training.

It has struggled with profitability since aggressively expanding in 2021 to compete on capital city routes against dominant operators Qantas and Virgin Australia.