TWENTY-one jobs were cut at GippsAero in the lead up to Christmas after the global aviation market experienced one of its worst years on record.
The workers – primarily production staff – were made redundant as the Traralgon-based aviation manufacturing company struggled to move forward in the declining industry.
A former employee, who wished to remain anonymous, told The Express the redundancies could not have come at a worse time.
“I was told just before Christmas,” the worker said.
“We asked them to wait until after the holidays but they said they couldn’t.”
GippsAero chief executive Keith Douglas said the company had tried to hold out on the job cuts for as long as possible.
“It’s unfortunate and extremely disappointing,” Mr Douglas said.
“It’s never an easy time to make any decision, there’s no good time to make such a change.”
He said the majority of the workers laid-off were contracted and were receiving government support.
The decision came as the global aviation industry struggles to fully recover from the global financial crisis, with 2015 hitting record low numbers.
“The aviation market had its worst year since the GFC last year,” Mr Douglas said.
“We are producing aircraft at a higher rate than we are selling them.”
According to Mr Douglas, GippsAero identified trouble was brewing in April last year. He said while he spent the next eight months trying to get a hold on the market, an independent group also conducted a study identifying targets which were not met, forcing the company to re-evaluate its position.
As a result a United States dealer and three from Europe were let go by the company, while the 21 Latrobe Valley employees were made redundant.
However, Mr Douglas said not meeting targets was an industry-wide issue.
“The whole industry is down. The Cessna 206 came down from 130 (aircraft) to 40 globally from the GFC on an annual basis, while GippsAero came down to 18 or 19,” he said.
This number is expected to fall again this year, with a projected target of 20 aircraft unlikely to be met. There are no current plans for further cuts, but Mr Douglas said if business did not pick up the situation would again be re-evaluated.
“We will continue to review on a month-by-month basis and realign the business accordingly,” he said.
Despite the job losses, the company will continue to build its aircraft in the Latrobe Valley but with focus on a smaller market.
“Our focus moving forward will be niche surveillance aircraft,” Mr Douglas said.
The company has its eyes on the Alaskan, Indian and Chinese markets which it hopes will lead to an expansion of its work undertaken at the Airfield Road base.
The former worker expressed disappointment at the current state of the aviation industry.
“It’s a real big shame that Australia’s industry and innovation is gone like that,” the former employee said.
“The Latrobe Valley has one of the highest unemployment areas in Victoria and the job losses might not sound like much, but that is families without food on the table.”
