On July 30 Prime Minister Anthony Albanese said the federal government would "examine any proposals" after Rex Airlines was placed in a trading halt.
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It comes as speculation mounts that the regional airline has brought in a restructuring team from Deloitte.
![A REX Airlines plane at Sydney Airport. Picture by AAP Image/Dean Lewins A REX Airlines plane at Sydney Airport. Picture by AAP Image/Dean Lewins](/images/transform/v1/crop/frm/233370197/d03e2451-bb25-4ac3-881b-d796f09ee612.jpg/r0_0_720_479_w1200_h678_fmax.jpg)
Mr Albanese said Rex received "substantial government support with no conditions attached" and questioned whether Rex should have moved beyond regional routes.
Rex "moved away from their traditional role of being a regional airline into flights, for example, from Sydney to Melbourne. Now, Sydney to Melbourne has been always in the top ten routes in the world and at one stage was the highest number of flights of any two destinations in the world. It consistently has been in the top four.
"Now Rex as a regional airline, of course, provides important links with regional communities, and particularly between capital cities and regional communities. It's important for those local economies," Mr Albanese said.
According to the ASX statement on July 29 the trading halt of the airline's shares will last until at least Wednesday.
The trading halt does not affect scheduled flights.
Transport Workers Union national secretary Michael Kaine said up to 2000 jobs were now in limbo.
"The TWU worked with Deloitte to get Virgin Australia back in the air and will work just as hard with them again to try to rescue Rex Airlines," he said.
"Despite multibillion-dollar Qantas claiming there's no room for competition, we know healthy competition is the only remedy for an industry in crisis."
'Important for regional communities'
On July 29, Mr Albanese said he believed the airline would "see their way through" amid speculation they had called in restructuring firm Deloitte.
"One of the things that we need to do is make sure that we have a viable and ongoing Australian aviation industry," he said.
Mr Albanese said "Rex is particularly important for regional communities, and there are a range of communities in NSW, in Queensland, in South Australia and right around the country that rely upon Rex, where Rex is the only airline to go to some of those destinations, so it's important".
Rex is Australia's largest regional air carrier outside the Qantas group and flies to all six states across Australia.
Rex has 56 destinations including many in regional Australia such as Port Macquarie, Coffs Harbour, Orange, Dubbo and Albury in NSW, Mount Gambier in South Australia and Burnie and Devonport in Tasmania.
It comes as budget carrier Bonza was permanently grounded after creditors voted to liquidate the embattled airline with staff still owed millions of dollars.