Qantas has cut 35 Hobart-based jobs as its regional airline takes over its Tasmanian service.
The Qantas Group has announced its regional airline QantasLink will replace the mainline service to Hobart, making its employees at the airport redundant.
The ground handling staff will be replaced by subcontracted workers.
The airline said the changes were necessary to remain a competitive force in Australian aviation.
"This change is about making sure we have the right aircraft on the right routes in support of leisure and business travel opportunities between Tasmania and the mainland," Qantas said in a statement on Tuesday.
"As a result of these changes, 35 Qantas employees at Hobart airport were today informed that their roles will become redundant."
The statement said QantasLink will commence a tender process for its ground handling services in Hobart.
"We understand this is a difficult time for impacted employees and will be supporting them throughout the process."
The Qantas employees will be offered redundancy packages and redeployment opportunities where possible, the airline said.
Federal independent member for Denison Andrew Wilkie said the move was an "alarming downgrade" of Tasmania by the Qantas Group.
"No wonder Qantas is in trouble financially. It's effectively abandoning destinations, axing staff and patching it up with subcontractors.
"When people fly Qantas they expect just that, not a succession of subcontractors."
Qantas had its credit rating downgraded in December after the airline announced it expected to axe 1000 jobs and would likely post a $300 million first-half loss.