QANTAS RESPONDS TO FALSE CLAIMS FROM REX

Published on 10th June 2021 at 12:00

REX CLAIM: Qantas isn’t refunding customers’ tickets leaving passengers out of pocket.

FACT: Rex made these claims in a newspaper advertising campaign based on a cherry-picked selection of critical social media comments directed at Qantas.

Rex was then found to be deleting critical social media comments on their own channels, including comments asking about refunds, comments about issues with Rex customer service, and comments that pointed out Rex was deleting negative posts.

When asked about this by the Australian Financial Review, Rex said they did “not apologise” for deleting comments they determined were “biased or unreasonable.”

Qantas remains committed to transparency and working with customers to resolve issues.

Since the start of the pandemic the Qantas Group has assisted more than 2.5 million customers with impacted flights.

If a customer’s Qantas flight is cancelled due to COVID they can choose between rebooking, a voucher or a refund. Most customers have opted for a travel voucher.

More than 100,000 Qantas flight credits have been redeemed in recent months.

We’re providing customers with additional flexibility to allow fee-free flight date changes. Jetstar offers the option of purchasing FareCredit on bookings which allow passengers to cancel flights for any reason.

REX CLAIM: Qantas customers are waiting for over a year to get their money back.

FACT: The vast majority of Qantas customer refunds are processed and completed within 6-8 weeks.

REX CLAIM: Qantas is a loss making enterprise at the best of times and its finances are precarious due to the impact of COVID.

FACT: Prior to COVID Qantas was recording annual profits in excess of $1 billion, while at the same time investing heavily in new aircraft such as the Boeing 787. Qantas remains just one of eight airlines globally to retain an investment grade credit rating through the pandemic.

We’ve maintained a high level of liquidity through the crisis because we were quick to cut costs and because we’ve been able to raise more than $4 billion in debt and equity.

Our three-year recovery plan means we’re well positioned to take advantage of the return of domestic and international travel, as evidenced by the fact the Group will be back flying at 90 per cent of pre-COVID domestic capacity in the fourth quarter of FY21, and over 100 per cent in FY22.

Most of the liabilities that Rex refers to are not advanced ticket sales subject to refunds but the value of deferred frequent flyer points, which are not redeemable for cash.

REX CLAIM: Qantas launching new regional routes is aggressive predatory behaviour designed to hurt Rex.

FACT:  We don’t start routes if we don’t think they will be commercially viable for us. In fact, in the second half of calendar year 2020, 99 per cent of the time we were able to fly, we generated positive cashflow.

Our position was supported by Australian Consumer and Competition Commission Chairman Rod Sims who told a parliamentary inquiry in March: “If Qantas has the aircraft, it’s incurring the fixed costs, it realises it can make a cash contribution by flying somewhere – it’s a bit hard to call that predatory.”

We know that extra capacity and lower fares increases overall travel demand, which is good news for the regional communities we operate to.

REX CLAIM: Rex will be forced to stop flying some regional routes because of the increased competition from Qantas.

FACT: Of the 34 new routes that Qantas and Jetstar have launched to adjust to new domestic travel demand patterns since mid-2020, just 10 are on routes that Rex currently operate and they remain the largest carrier on all of these routes.

Threatening to abandon regional communities is a shameful tactic employed by Rex whenever it thinks things aren’t working in their favour.

Rex has threatened to withdraw services eight times in the past 12 months, with communities from Armidale to Kangaroo Island finding out from media reports that a critical air link might (but probably won’t) disappear.

REX CLAIM: Qantas has received a special treatment from the Federal Government compared to other airlines

FACT: Qantas has about 70 per cent share of the domestic market, so it’s no surprise that we’ve received a significant proportion of the Government assistance for airlines.

But when you consider the relative size of the airlines, Rex received seven times as much government support as Qantas in 2020.

The majority of government support we’ve received has been through JobKeeper, which went to our employees.

The latest federal support package also included additional support for Rex, including extensions of the Regional Airline Network Support and Domestic Aviation Network Support schemes.

Rex has not received funding under the International Aviation Support package as they don’t fly overseas, unlike Qantas and Virgin.

REX CLAIM: Qantas sold tickets on international flights from 1 July that it never intended to operate.

FACT: Throughout the pandemic we’ve regularly adjusted our assumptions for the restart of our international operations.

In the second half of calendar year 2020 we were planning for a 1 July restart. Given the high uncertainty around the re-opening of our borders we sold very few tickets on these services.

In February we adjusted these assumptions and are currently planning to restart international operations from the end of October 2021.

As we’ve seen with the New Zealand bubble, which opened earlier than anticipated, things can change quickly.

We maintain the flexibility to bring forward, push back or stagger the resumption of our international flights to align with any changes to the Australian Government’s COVID-19 vaccine rollout timeline or approach to international travel.

REX CLAIM: Qantas has more than $5 billion in ticket sales on their books, most of which are due to be refunded.

FACT: As we explained in our interim accounts, the majority of this line item is the value of unredeemed frequent flyer points which are not refunded for cash.

The rest is advanced ticket sales, and we know latent travel demand remains very strong.

Note: This page will be updated to correct further false claims from Rex