Qantas considers 300 cuts in Avalon

Qantas (ASX: QAN) may be calling it quits in Avalon. In an attempt to streamline operations and cut costs, Qantas is reviewing the remaining 300 engineers, maintenance workers, and contractors at its Victoria facility.

The review will most likely lead to layoffs – and it makes sense. Simply put, the facility’s out of work. Domestic CEO Lyell Strambi said in a statement, “In fact, there will be no scheduled maintenance for the equivalent of five months each year for the next four years, starting in March 2014.”

The most recent news has gone political, according to the Sunday Morning Herald, with State Labor opposition leader Daniel Andrews blaming Premier Denis Napthine for not fighting hard enough for local jobs. For its part, the Australian Workers’ Union noted its surprise and called Qantas’ review “another move towards offshoring.” While Avalon isn’t likely to see expansion going forward, Qantas has slotted $30 million towards upgrades at its Brisbane heavy maintenance facility, the undisputed “winner” in Qantas’ consolidation.

Cutting costs can help a company like Qantas, but there are corporations out there with nothing on their mind but solid, sustainable sales. Discover The Motley Fool’s favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of “The Motley Fool’s Top Dividend Stock for 2013-2014.”

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Motley Fool contributor Justin Loiseau has no position in any stocks mentioned in this article. You can follow him on Twitter @TMFJLo.

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