By Elsie Adamo and Elisabeth Champion
Regional airline Rex has asked the ACCC to reopen a closed investigation into Qantas for anti-competitive behaviour, following the news that Qantas will no longer offer flights between Mount Gambier and Melbourne.
The national carrier announced last week that it was cancelling the route between Mount Gambier and Melbourne just 16 months as of 15 August, due to a lack of passengers.
A QantasLink spokesperson said the business had made multiple attempts to increase uptake in the route, including altering the schedule four times based on customer feedback as well as sales.
“We saw genuine growth potential on the Melbourne-Mount Gambier route but unfortunately, we have not seen the growth materialise and it’s no longer viable for us to continue operating,” a spokesperson said.
Customers with tickets on Qantas’s Melbourne-Mount Gambier route after 15 August will be contacted by the airline and offered a route change, credit or refund on tickets.
QantasLink launched in Mount Gambier in March 2021, offering three flights a week on the Mount Gambier-Melbourne route and five on the Mount Gambier-Adelaide route which has since increased to seven.
The spokesperson confirmed there is no current consideration to withdraw from the Adelaide-Mount Gambier route.
“We remain committed to the Mount Gambier community with our flights to Adelaide and are working with tourism partners to promote all that the Limestone Coast has to offer,” a spokesperson said.
The QantasLink spokesperson confirmed the withdrawal is not a suspension, and there are no plans at this stage to reinstate the Melbourne-Mount Gambier route at a later date.
Despite the move leaving leave Rex Airlines as the sole operator of the Mount Gambier to Melbourne route, Rex has accused Qantas of “predatory“ behaviour in a media statement this week.
“Qantas’ announcements about its intention to suspend and cancel operations on both the Melbourne-Wagga Wagga and Melbourne-Mount Gambier routes respectively due to a lack of aircraft and patronage clearly demonstrate Qantas’ true intentions when it entered into these and other uneconomical regional routes to compete with Rex,“ the statement read.
“The Rex Board had to decide if it should retreat from regional services since they were no longer commercially viable due to Qantas actions.
“The Rex Board decided to meet Qantas’ predatory actions with resolute determination. Instead of retreating, Rex increased services significantly on regional routes with larger passenger numbers in competition with Qantas.
“Rex has also taken delivery of more aircraft to compete on new routes against Qantas.“
In March, The ACCC dismissed Rex’s complaints against QANTAS, noting that a range of factors impacted the competitive dynamics in the market at the time, particularly the Covid-19 movement restrictions and border closures.
In a report the ACC said the the investigation commenced after Rex raised concerns in late 2020 and early 2021 about Qantas entering regional routes with low passenger numbers that have historically been operated by Rex, and Qantas adding capacity on intercity routes after Rex began operating on these routes.
“Covid-19 related measures have now been relaxed and this will simplify evaluating the impact of any future capacity increases or pricing practices by airlines in response to new competition. The ACCC will continue to pay close attention to any behaviour that may be anti-competitive.“
