Qantas Airways Ltd has announced a "review" of its aircraft maintenance work at Avalon, triggering union fears of up to 300 remaining engineering jobs being made redundant.
The Australian Workers Union (AWU) says the announced operations review is code for closure and flags another move towards offshoring.
AWU Victorian secretary Ben Davis says the future of Avalon looked bleak for the 300 maintenance engineers employed at the site.
"We know from experience that when Qantas does a review, jobs go," Davis said.
"Avalon does overflow maintenance from the Qantas centre in Brisbane. The only place at least some of that work could go would be overseas if this review leads to closure."
Davis said the Geelong region had suffered with the closure of Ford operations, while the Shell Refinery and Alcoa at Point Henry are under threat.
"It is a disgrace that we are being forced to watch the destruction of an important and strategic skills base," he said.
The review follows 263 redundancies at Avalon announced in November last year and the closure of the Tullamarine heavy maintenance facility, which resulted in 422 jobs cut.
But Qantas is stressing that no final decision has been made as the review at Avalon begins.
Qantas' domestic chief executive officer Lyell Strambi said in a statement that the Avalon maintenance centre was becoming "sub-scale and inefficient".
Strambi said retiring its Boeing 747 aircraft was reducing the workload at the facility and it would soon replace the planes with next generation aircraft.
From March next year, maintenance will not be scheduled for five months of the year for four years, he said.
"We will invite our employees, unions and other parties to sit down and discuss the challenges and look at potential options for our Avalon base," he said in a statement.
Strambi said a decision would be made after October, when discussions with employees had been finalised.
He said irrespective of the outcome of the review, Qantas would continue to do the vast majority of its maintenance in Australia, employing thousands of people.
"Qantas is the only major airline which does heavy maintenance at its own facilities in Australia, and this will continue to be the case into the future," he said.
The airline recently swung to a small full-year profit but declined to give guidance, citing the high degree of uncertainty plaguing the economy, global aviation markets and fuel prices.
Qantas has lately been forced to lower costs and refocus on customer services due to Virgin Australia Holdings Ltd's campaign for local market share.
But the airline has said it is confident of maintaining market share.
The flights, a Sydney-Adelaide return service operated by an Airbus A330, will be powered by a biofuel derived from used cooking oil (split 50:50 with conventional jet fuel).
It has selected Air New Zealand as its Airline of the Year for 2014.