Qantas Cost Cuts Nothing To Do With Oil Price: Union

The following article about Qantas' decision to close its Mildura maintenance base was published on ABC Online on Tuesday 17 June, 2008.

The Australian Workers Union (AWU) has accused Qantas of using rising oil prices as an excuse to cut regional jobs and services.

Qantas will close its Mildura maintenance base by mid-August, and has offered to relocate its 20 staff.

Chief executive Geoff Dixon has blamed the rising oil prices for the decision.

He says Qantas will retain existing flight operations, cabin and ground crew bases in Melbourne and Mildura, to cover Victoria, Tasmania and Canberra.

But the AWU's state secretary for Victoria, Cesar Melhem, says the cost cutting measures have nothing to do with oil prices.

"If you're not delivering a huge profit to Qantas, Qantas will dump you and walk away from you," he said.

"That's become the mentality of Qantas - it's really disappointing."

The Mildura facility will close on August 15.

Qantas shares have fallen amid a surging oil price overnight and today's announcement about regional services.

At close of business, Qantas shares had fallen 3 per cent on the sharemarket to $3.22.

Meanwhile, Virgin Blue was up 0.9 per cent to 58 cents.