AURIZON Holdings (ASX: AZJ) will shed 480 staff across its Queensland facilities as part of its transformation program from June this year through to 2017.
Communities in Redbank and South Townsville will be affected by the overhaul, which host two facilities that currently comprise of 565 employees.
AZJ, Australia's largest freight business, plans to end passenger-related maintenance contracts for Queensland Rail at both of these facilities in an effort to reduce operational costs.
Centralisation is at the core of the strategy, with the company proposing plans to collocate heavy maintenance and component overhaul work at its Rockhampton facility.
This is a cost-driven move based on Rockhampton’s proximity to central Queensland coal mines, in accordance with AZJ’s intentions to improve productivity by more than $130 million by full-year 2015.
In light of this, the company says some of the staff shed from its Redbank and South Townsville facilities will be redeployed or offered retraining.
“Aurizon wants to provide as much time as possible for people to seek opportunities for relocation, retraining or to apply for other roles in the company in the event that its proposals are implemented,” the company said in a statement issued today.
The Redbank and South Townsville workshops will downsize from next month, Redbank expected to close in June 2017 and South Townsville in June 2016.
However, AZJ will maintain a presence of 400 employees in the Townsville district, dispersed across a number of its other projects in the area.
The announcement appears to come as an extension of the company’s ongoing focus of pushing down operational costs.
AZJ managing director and CEO Lance Hockridge highlighted this is a key area to improve on in the company’s half-year report released in February.
“We will continue to maintain the intensity of work on transformation and reform initiatives to reduce costs, list productivity and deliver improved customer service levels,” Hockridge said in relation to the second half of the year.
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