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2mo ago

Australian Government Prepares to Nationalize Rex Airlines Following Financial Collapse

Prime Minister Anthony Albanese confirms contingency plans to acquire the regional airline if private buyers cannot be secured, citing its critical role in connecting rural communities.

Overview

  • Rex Airlines entered voluntary administration in July 2024, burdened by $500 million in debt to 4,800 creditors following a failed expansion into capital-city routes during the COVID-19 pandemic.
  • The Australian Securities and Investments Commission (ASIC) is investigating Rex and its directors for allegedly misleading investors about the company's financial health in 2023.
  • The federal government controversially provided an $80 million loan in November 2024 and acquired $50 million in Rex's debt to maintain regional services during the administration process.
  • Prime Minister Anthony Albanese announced plans to nationalize Rex if no private sector buyer is found, emphasizing the airline's importance to regional connectivity and local economies.
  • Critics, including Deputy Liberal leader Sussan Ley, oppose nationalization, arguing taxpayers should not bear the financial burden of owning an airline.