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Outback airlines warn of imminent collapse amid crippling coronavirus pandemic

At least eight regional airlines could collapse within days because of the crippling coronavirus pandemic.

The airlines have made a ‘united plea’ for the Federal Government to provide urgent financial assistance during the COVID-19 crisis. 

Australians have been advised to stay at home and avoid non-essential travel due to the outbreak, while all states and territories except NSW and Victoria have imposed lockdowns. 

‘The containment strategy has had a devastating impact on the revenue of all airlines but in particular for smaller regional airlines with lower capital reserves,’ the eight airlines said in a statement. 

‘The financial survival of our companies can be counted in days rather than weeks.

‘Given the urgency of the situation we call upon government to offer our companies a lifeline.’

The eight signatories are: Air Link, Aviair, Alliance Airlines, Chartair, Fly Corporate, FlyPelican, Hardy Aviation and Sharp Airlines.  

The Federal Government last week provided a $715million rescue package for airlines, which will involve forgoing fuel excise, air service charges and regional security fees.  

But Opposition transport spokeswoman Catherine King said the relief package was not nearly enough and failed to support airlines whose fleets were grounded.  

Regional Express (Rex) has also warned it could shut down without immediate support from local, state and federal governments. 

On Thursday, Rex said they had been granted an interim authorisation from the ACCC to coordinate with QantasLink and Virgin Australia on 10 regional routes where Rex normally competes with the airlines.

‘Rex will enter into discussions with QantasLink on how best to service regional communities only if there are meaningful assistance packages given by the Federal, State and Local governments to keep essential regional air services going,’ a statement said. 

Rex Deputy Chairman, the Hon John Sharp AM thanked the ACCC and The Civil Aviation Safety Authority for stepping up to the mark during the health crisis.

‘However, these measures alone will not allow the airlines to survive the next three months,’ he said.

‘The Federal, State and Local governments all need to act urgently and decisively to determine specific assistance packages so that the airlines can at least provide the bare minimum of essential air services to keep the communities running. 

‘Eight other regional airlines have given a 24-hour ultimatum to the Federal Government saying they only have days before they collapse.’  

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