A Carbon Tax Just Won't Fly: Regional Express
Western Advocate | Aug. 29, 2011
Bathurst's only airline provider says a carbon tax could put increased pressure on regional air services.
Regional Express admits the basic maths of the carbon tax will add just AU$2 to the price of every ticket, but yesterday warned this could be enough to turn customers off.
The airline, also known as Rex, said that the tax - especially the impost on aviation fuel - would cost the company AU$2 million in the first year.
Chief operating officer Chris Hine said while that would add just AU$2 to the price of each ticket, the equation was not so simple.
Joining Opposition Leader Tony Abbott at Adelaide Airport, Mr Hine said experience had shown that small increases, such as AU$2 here or there, could have an impact on demand.
If they stopped just one person flying that would force ticket prices up further or threaten services, he said.
"The perception is that we should simply pass that (extra cost) onto our travelling customers without that causing any impact on demand," he said.
"(But) we know through experience that simply adding AU$2 here, AU$2 there, will affect demand and make that ability for air travel harder and harder."
Mr Hine said cuts to regional airlines' services or higher ticket prices would also push more travellers into cars, defeating the purpose of the carbon tax.
Mr Abbott said one of the biggest impacts of the carbon tax on regional Australia would be on air travel.
He said increases in the price of travel would further add to cost-of-living pressures already being experienced by regional Australians.
"Ultimately, as the carbon tax goes up and up and up, there will be pressure on services, potentially cuts in services and that means the quality of life in regional Australia goes down," he said.
The carbon tax is just the latest hurdle in what has been a difficult year for Rex.
Earlier this year there were fears the airline would discontinue its services to Bathurst following protracted discussions with Bathurst Regional Council over landing taxes and discount fares. Those negotiations have now been finalised.