Up the Cats (with a sharp stick!)

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The news this morning is that Qantas is pulling its Avalon heavy maintenance unit:

Qantas Airways Ltd has confirmed it is closing its heavy maintenance base at Avalon, near Melbourne, at the end of March 2014.

The base employs around 300 people and services the airline’s soon-to-be retired Boeing 747s.

“Qantas is gradually retiring our fleet of Boeing 747 aircraft, which means there is not enough work to keep our Avalon base viable and productive,” Mr Strambi said.

The Avalon airport is serviced by staff in and around Geelong. We already know that Ford is pulling out in 2016, which will be huge blow to the local economy, not to mention if Holden goes many of the suppliers based in Geelong will go as well.

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Shell is already aiming to sell its Corio oil refinery and will turn it into a much less labour-intensive import facility if it fails.

Alcoa’s Port Henry aluminium smelter is also in trouble, kept alive only by subsidies.

Incitec Pivot’s Lara operations are for sale and it’s under pressure from rising gas prices and investing in the US.

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My wife is from Geelong and I know a lot of worried folks in the town. If there’s another place more on the front line of Australia’s decision to throw aside manufacturing I don’t know of it.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.