News: REX Australia to guarantee regional flights on stricken airline Rex

Australia will guarantee flights on Regional Express Holdings (REX) airline for those booked on regional routes, but not between state capitals, the transport minister said on Thursday, weeks after it entered administration and cut hundreds of jobs.

Traditionally focused on servicing Australia's vast regional areas with small planes, Rex appointed administrators last month, becoming the second airline in Australia to do so this year.

Transport Minister Catherine King said on Thursday the government will guarantee that passengers with regional flight bookings with Rex will either fly or get their money back throughout the voluntary administration process.

"Rex’s continuation is in the best interests of Australia – and the government is working closely with the administrators to ensure a strong regional aviation presence now and into the future," she said in a statement.

The airline carries passengers and freight on 41 routes to regional and remote communities, including 21 routes that are only serviced by Rex, she added.

Rex also has some larger jet flights in the lucrative "golden triangle" between Sydney, Brisbane and Melbourne, which will not be guaranteed by the government.

The airline's collapse, which comes only three months after budget airline Bonza closed down, has put a spotlight on the barriers smaller players face breaking into the vast, sparsely populated market, that is dominated by national carrier Qantas (QAN) and Virgin Australia.