I'm not so sure it's a bad move; the population of the western suburbs/Geelong is quite substantial.
Hobart, Launceston have 6 flights a day or more, with less population supporting those airports. Initially the low amount of flights could work; but long term will people from SY, BN etc. want to use that airport when they have a choice.
Transport issues will be huge, $70+ cab ride to the city will really hurt, so public transport will need to be fantastic to make it work.
Good luck to them I say; can I get a job at AV tower; will it need radar approach services?
Bottle of Rum