As a publicly listed company, we are compelled to respond to the baseless and scurrilous accusations that Orange City Council - whose failed policies are becoming more and more apparent - continually levels against Rex.

1. Rex is deliberately keeping passenger numbers down.

With great fanfare, council trumpeted the start of Brindabella Airlines services to Orange in February 2013. 

However, during the 10 months of its existence, passenger numbers continued to decline from 63,907 passengers a year to 57,141 passengers a year. 

It defies human logic to understand how Rex could have kept passenger numbers down when Brindabella was only averaging seven passengers on each flight (out of a capacity of between 18 and 30 seats) and were only too keen to take on any passenger that Rex is supposed to be keeping away. 

We would not be surprised if council next accuses Rex of colluding with Brindabella to keep passenger numbers down.

2. Rex has increased its fares sharply.

Rex has faithfully and seamlessly served the Orange community for over 12 years, before that, for more than 20 years through Rex’s predecessor, Hazelton Airlines. 

Rex’s fares today have risen by less than 2 per cent annually (less than CPI) over its 12-year existence, whereas council’s airport head tax collection has increased from around $440,000 per year to around $820,000 per year (approximately +86 per cent), representing an average increase of some 7 per cent per year. 

Passenger numbers would have totally collapsed if Rex followed the example of council as this would see the best fare between Orange and Sydney priced at $240 today.

3. Rex is charging too much for its fares.

Rex fares from Orange are not different to those of other regional ports, including Parkes and Bathurst. 

Bathurst does have a lower entry level fare due to the partnership agreement between Rex and Bathurst Regional Council. 

If our fares were too high, we would not have seen an average of only seven passengers per Brindabella flight and we would not have seen Brindabella collapse.

Fares are lower on the Dubbo to Sydney route due to the oversupply of capacity that QantasLink has dumped on this route. 

Qantas well knows what overcapacity is, as it is losing around $1 billion a year due to this same reason, with its shares now rated at junk status.

Rex strives to provide a viable and sustainable air service and its latest half-year report shows that its airline profit before tax is only around $3 to $4 per passenger. 

We compare this to the exorbitant head tax imposed by Orange City Council of $16.73 per passenger, which is the highest rate in the entire Rex network and more than double what most other councils are charging.

Orange City Council’s ‘build it and they will come’ approach is a pipedream as passenger numbers continued to decline even when competition was introduced. 

Council’s latest round of accusations probably shows that it is desperate in trying to avoid responsibility for building a white elephant that is seven times more than what Orange would ever need.

We are already seeing the direct impact of the misguided polices of council as it raised the head tax by another 5 per cent to make Rex’s passengers pay for the bad debts owed to council by Brindabella Airlines. 

We can only expect further price increases with the inauguration of council’s grandiose terminal with its much higher maintenance and depreciation costs. 

This will further depress passenger numbers, creating a dangerous downward spiral.

Rex and Hazelton have faithfully served the Orange community for over 30 years through thick and thin, drought and snow. 

We intend to continue to provide a reliable, sustainable and quality air service with fair fares and heartfelt hospitality. 

However, Rex will not be the whipping boy for a failed council. 

Rex notes council’s resolution calling for negotiations and will entertain such dialogue once council ceases its self-serving politics and starts to genuinely care for the community that elected it.

Warrick Lodge, General manager, network strategy and sales, Regional Express (Rex)