They did maintain healthy cash buffers and kept costs down, but the speed and scale of their fleet expansion and market entry clearly outstripped the conservative risk profile that suits Rex.

A more measured approach—bringing in new planes gradually, testing a few routes before a full launch and negotiating stricter debt covenants—would have let them grow without exceeding their true risk appetite.

Rex’s board stretched the airline beyond the low-risk envelope you’d expect from a small regional carrier by underestimating both industry dynamics and broader macro forces. Under Porter’s Five Forces, they plunged into a market defined by intense rivalry (going head-to-head with Qantas and Virgin), strong supplier power (locking into large-jet leases with OEMs and lessors), and high buyer bargaining (price-sensitive travellers hunting the best deal). Even the threat of new entrants and substitutes loomed larger than usual—digital meetings eating into business travel—and Rex’s balance sheet didn’t (appear to) have the same cushioning that bigger airlines enjoy against these pressures.

A PESTEL view makes the stretch even clearer. Politically and legally, COVID-era restrictions and shifting health mandates kept demand unpredictable. Economically, fuel-price volatility and a potential consumer-spending downturn raised the stakes on every extra aircraft. Social trends—like remote work cutting into business bookings—eroded some of the upside Rex had counted on. Technologically, onboarding new jet types meant (additional) steep training and systems costs. And environmentally, tougher emissions targets added another layer of compliance risk. By racing into big-jet orders and costly routes without fully mitigating these Porter and PESTEL risks, the board exceeded the conservative risk appetite that normally safeguards Rex’s long-term stability.

• Targets lightly served regional routes (the heart of the Rex origins) where Rex already has brand strength

• Scales up with larger aircraft in phases, only as demand is proven (evidence based)

• Leverages partnerships and codeshares to share risk and access loyalty programs

• Uses short-term, flexible leases to limit long-term commitments

This approach would then align expansion with Rex’s conservative risk appetite, preserving financial resilience while growing selectively, and maintaining an 'in air' presence, strategic growth in line with cultural origins and importantly remaining solvent.