REGIONAL Express has announced on Monday morning it will shutdown all services to Albury airport from April 6 if it does not have its losses underwritten by governments.
The airline made the announcement it would abandon all but Queensland services across Australia following an emergency board meeting on Sunday.
Rex's deputy chairman John Sharp said the further measures announced recently to tackle COVID-19 meant the aviation sector had reached a tipping point.
"Rex is supportive of the strong measures taken by the federal and state governments such as the shutting of state borders and imposing a lockdown within the States as well as discouraging all non-essential travel," Mr Sharp said.
"These measures will definitely reduce the number of infections from COVID-19, prevent the health care system from being overwhelmed and save many lives.
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"However, tragically for the airline industry, this means that we can expect the year-on-year reduction of passenger numbers to nosedive to around 80 per cent from the 60 per cent we are experiencing today.
"There is a tipping point in the airline business beyond which it will no longer be sustainable to operate reduced services.
"We believe that with only 20 per cent of our passenger numbers left we have reached that point and the Rex Group has decided that the quasi suspension of all services at this stage presents the best option to preserve its cash.
"The federal government has acted swiftly by promising a rescue package to the airlines of $715 million.
"However, the direct benefit to Rex from this package is only $1 million a month which is grossly insufficient to cover the $10 Million a month we expect to lose running the heavily reduced schedule we announced last week.
"The US government has put in place a rescue package of US$50 billion for a total airline revenue in the USA of US$240 billion about 20 per cent of one year's worth of revenue.
"Australia's total airline revenue is A$23 billion indicating that an equivalent effort in Australia would require a rescue package in the order of A$4.6 billion instead of the A$715 million proposed."
Passengers with bookings after April 6 must wait until after March 27 before writing in via Rex's website to put their bookings on credit for a future flight.
No refunds will be offered as is the standard practice of all airlines during this crisis.
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