Aircraft engine overhaul provider LTQ Engineering will cease operations and close its Tullamarine facility in September, resulting in the loss of 164 jobs.
The company cited the strong decline in engine overhaul demand as the reason for the closure.
"Reduced regional demand, tough international competition and more reliable new generation engines have directly impacted the viability of the business,” LTQ Chairman and Lufthansa Technik chief executive officer, August Wilhelm Henningsen said.
“Simply put, LTQ does not have the scale of engine maintenance work to be competitive," he added.
Lufthansa Technik advised Qantas that it could not continue to invest in the loss making Tullamarine facility.
LTQ Engineering said the board had evaluated a number of different strategies to address the continued losses, including winding down the company.
Considering the strong decline in demand and the company's business and outlook, LTQ conceded that it was not financially viable.
“The joint venture partners have therefore decided to wind down production and close the company,” LTQ’s statement read.
Minister for Employment and Workplace Relations Bill Shorten expressed his concern for employees and families affected by the closure in a recent statement.
On 26 July, the day the closure was announced, Minister Shorten said: “My thoughts are with LTQ Engineering workers and their families who will be feeling uncertain and anxious today.”
All affected workers will be entitled to employment support through Job Services Australia, Minister Shorten said.
Federal Member for Calwell Maria Vamvakinou said it was a difficult time for those in the electorate losing their jobs, particularly for their families, and pledged to work closely with the Minister to provide “as much assistance as possible”.
“The LTQ Engineering facility is located in the North Western Melbourne Priority Employment Area. The Local Employment Coordinator for this area will work closely with stakeholders to help drive the local response to redundancies, including facilitating new job opportunities,” Vamvakinou said.
Image source: from the Lufthansa Technik website