Thales Australia will reduce the number of employees at its Lithgow Small Arms Factory from the current total of 140.
The ABC reports this morning that increased competition in both civil and defence markets as well as a decrease in the federal defence budget have been blamed.
“Thales is a wonderful company and they've assured us [of the] the 17 positions, most of those will be through natural attrition, and they feel very focussed that they still have a bright future in Lithgow," Mayor Maree Statham told the ABC, saying that she hoped the region would still have a future in that industry.
The factory has been open since 1912, according to its museum.
"We had assurance from staff today that they have a bright future and the council will certainly be supporting that,” said Statham.
"I believe a lot of the people have been there for a long time and they'll get a very good attrition package and the company will look after its workers."