South Australia’s aviation industry has received a second blow in April with Alliance Aviation Services to outsource heavy maintenance work to Europe.
Alliance, which is mainly a fly-in/fly-out and charter operator, said on Tuesday it would send its Fokker fleet to Austrian Technik Bratislava for its regular heavy maintenance checks.
The transfer of that work, which is currently performed in Adelaide, to the Lufthansa subsidiary would impact 22 staff positions and up to 10 contractor positions at the company’s Adelaide base, Alliance said.
The measure was forecast to save $1.7 million a year.
“The closure is part of structural and operating changes to improve the company’s long term profitability that were outlined in the half yearly results presentation,” Alliance chief executive Scott McMillan said in a statement.
“We have already foreshadowed a reduction in the company’s fleet and the consequent improvement in productivity through increasing aircraft utilisation.”
Alliance said it would offer some staff alternative employment at other parts of the company, while redundancy costs would be between $400,000-$800,000.
The airline said it would continue to conduct heavy maintenance in Brisbane, while line maintenance would remain at Adelaide, Auckland, Brisbane, Cairns, Melbourne, Perth and Townsville.
Moreover, there would be no impact on the airline’s service to the resources sector or its push to secure more tourism-related and other non-mining work across Australasia.
Alliance’s move to outsource its Fokker heavy maintenance comes as Cobham Aviation Services is making some staff redundant in Adelaide after losing heavy maintenance work on QantasLink’s Boeing 717 fleet.
Qantas was establishing a new heavy maintenance facility for the 717 fleet at Canberra Airport.
Alliance said in February it was working to secure more non-mining related work after it swung a net loss of $25.8 million for the six months to December 31 2014, compared with net profit of $6.5 million in the prior corresponding period.
The statutory figure included a $41.4 million impairment charge on the carrying value of its aircraft fleet.