A Launceston steel factory will close by March next year, with around 100 people to lose their jobs, as the business moves to Queensland.
The Bradken engineering plant at Youngtown produces steel castings for the manufacturing industry.
It supplies to a range of companies, including Caterpillar, which is moving its manufacturing business to Thailand.
Bradken has informed its Launceston workers of the decision, blaming decreasing demand and higher operational costs for the decision
The company's executive general manager Brad Ward said the total cost of supply from Launceston was much higher than the company's other under-utilised plants, making manufacture there unviable.
"As a result of low plant volumes it is closing its Launceston foundry and machine shop, with closure expected to occur by the middle of 2016," he said.
Mr Ward confirmed most of the work done in Tasmania would be transferred Queensland.
They were making a profit and they've got orders booked so it's completely out of the blue.
John Short Australian Manufacturing Workers Union
"Full entitlements are secure and will be paid in accordance with contracts," he said.
In May last year, the company announced it would cut around 10 per cent of its workforce nationally as it restructured its manufacturing business.
John Short from the Australian Manufacturing Workers Union (AMWU) said employees were shocked by the announcement.
"Our understanding is that the company in Launceston was travelling quite well, they were making a profit and they've got orders booked, so it's completely out of the blue," he said.
"[The workers] were believing that they were going quite well at the moment so just before Christmas, it's a terrible decision.
"They probably just want to bring all the work back to Queensland and look after a couple of foundries up near Brisbane."
Mr Short said he believed the decision was not influenced by Caterpillar's relocation to Thailand.
"They said even with Caterpillar closing down, they would have still been able to survive on their own," he said.
"They had a percentage of work at Caterpillar but in fact, they're getting more work from Caterpillar at the moment because they're building up their stocks prior to them closing down.
"The Australian dollar has probably been affecting them, particularly over the past few years.
"But now it's down to about 74 cents you would think that companies would reinvest in Australia but also in Tasmania."
State Government urged to intervene
Mr Short urged the Tasmanian Government to step in to stop the job losses.
"The State Government [should] go and talk to Bradken because it's not on price, it's not on wages. I'd suggest they might be on slightly higher wages in Queensland," he said.
"Go and see Bradken, and see why they've closed the place down and see if there's a way of turning round the decision because it's a very important industry to that area.
"They pay incentives to bring people to Tasmania but these are jobs that are already here, and they should do whatever they can to secure those for the long-term future."
Mr Short said the workers losing their jobs were skilled and it was a shame the positions were being sent to the mainland.
These people are highly skilled and once this business is gone, it's gone.
Bryan Green, Tasmanian Opposition Leader
"There's probably going to be limited opportunities, there's not that many foundries around, it's specialised work," he said.
"If we can keep them here, we should keep them here and give them an opportunity somewhere else in Tasmania."
State Opposition Leader Bryan Green has accused the Government of inaction.
"Losing these jobs, these manufacturing jobs, which come off the back of the closure of the Caterpillar site at Burnie, leaves our ability to manufacture in our state almost gone," he said.
"[The Government] has sat on their hands and watched these jobs disappear."
He added it was a devastating outcome for the workers.
"They're a dedicated team and I know they've worked really hard over a long period of time to make that business as efficient as it possibly can be," he said.
"These people are highly skilled and once this business is gone, it's gone."
The State Government has been contacted for comment.
Mayor urges workers to consider re-skilling
Launceston Mayor Albert van Zetten is disappointed by the company's decision.
"It's extremely sad for their staff ... especially just before Christmas to hear this sort of news," he said.
"For all their family and the greater Launceston community ... it means that there's wages taken out of the economy which is something which we don't really need at this time."
"[Bradken has] been a very important part of our economy and a lot of people have trained through that, worked through there and that's probably the only employment they've had."
But he said the region must adjust to the changing times.
"There [are] changes happening and that's why as a council we're looking for those areas and to support those areas," he said.
"We see tourism is continuing to grow and develop and that's exciting for Launceston and very important.
"People need to be re-skilling into different areas."
Source: abc.net.au
