The Federal Government has announced a $715 million support package for Australia’s struggling airlines which are bleeding through their cash reserves as coronavirus travel restrictions choke demand.
The government will forgo fuel excise, air service charges and regional security fees.
The move is expected to create an upfront benefit of $159 million, with the government refunding charges paid since February 1.
“Our airlines run on tight budgets at the best of times and these past few weeks have been particularly tough,” Deputy Prime Minister Michael McCormack said.
“I’ve been speaking with Australian airline executives every day and will continue to work with them to make sure they receive the support they need.
“Providing this assistance not only helps our airlines, but the entire aviation industry, regional Australians in particular and other industries such as tourism and trade, which rely on aviation.”
Regional airline Rex announced a voluntary trading halt to the ASX, saying the smaller carriers only had “only weeks of reserves left”.
“Rex does not believe that Rex, and all other regional carriers, will be able to pull through this crisis without significant assistance if the health authorities’ projections prove accurate,” said Rex’s chief operating officer Neville Howell in an open letter to the Deputy Prime Minister
“If regional carriers collapse, so will many regional communities for which the air service is their lifeline.”