GE Will Cut Another 13,000 Jobs
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General Electric (GE) on May 4 said it plans to cut as many as 13,000 jobs from its Aviation unit this year, or about 25% of the division's total workforce, as the company continues to feel the impacts of the global coronavirus pandemic. The cuts include a 10% reduction to its U.S. workforce previously announced in March.
GE Aviation on Monday said the cuts are in response to as much as an 80% drop in global airline traffic in the second quarter of this year. The job cuts will include voluntary and involuntary layoffs. The Aviation unit earlier issued furloughs impacting about 50% of its U.S. maintenance, repair, and overhaul employees, and those working in new engine manufacturing. The company also canceled merit salary increases.
Our aircraft manufacturers have announced reduced production schedules that will extend into 2021 and beyond reacting to the projected prolonged recovery," GE Aviation CEO David Joyce said in a written statement. While extremely difficult, I am confident this is the required response to the continued contraction of the industry, and its protracted recovery."
GE last week when it reported first-quarter earnings results said it had taken a $1 billion hit in Q1 to its cash flow, and was developing a plan to cut costs by $2 billion, along with other actions to preserve cash, which includes job cuts. The company on April 29 said it had cut 700 jobs from its Power unit in the first quarter. The company on April 30 announced it was closing a technology center in New Orleans, Louisiana, and laying off all 100 workers there.
Turbine Manufacturers StruggleGE in 2017 said it would cut 12,000 jobs from its Power unit, an effort the company said would save $1 billion in 2018. That announcement came as GE-like other turbine manufacturers such as Siemens- weathered a global slowdown in the market for gas turbines due to the growth of renewable energy.
Monday's announcement includes the job cuts announced by GE Aviation in March, when the unit said it was cutting about 10% of its U.S. workforce, including about 2,600 jobs at its plant in Evendale, Ohio. GE Aviation has about 10,000 workers in the area around Cincinnati.
We are developing our plan for permanent reductions to our global employee base that we anticipate will bring our total reductions this year to as much as 25% (including both voluntary and involuntary actions already announced)," Joyce said in Monday's statement. These plans, which we expect will be ready over the coming months, are part of a comprehensive strategy we are developing for resizing the business consistent with the forecast of our commercial market. While extremely difficult, I am confident this is the required response to the continued contraction of the industry, and its protracted recovery. I am equally confident that the industry will recover over time and that we will be positioned to win."
Boeing Cuts 16,000 JobsThe additional cuts announced by GE on Monday come after Boeing last week said it would cut 10% of its global workforce, or about 16,000 jobs. The global pandemic has changed the way we live and work," said Boeing's chief executive, David L. Calhoun, in a note to staff. It is changing our industry. We are facing utterly unexpected challenges."
Calhoun last week said he expects it will take two to three years for travel to return to 2019 levels and it will be a few years beyond that for the industry to return to long-term growth trends."
Airline industry equipment supplier Spirit AeroSystems Holdings said Friday it is cutting 1,450 jobs. The company is a major supplier to Boeing and Airbus.
Spirit said it has offered voluntary layoffs to union workers at its Wichita, Kansas, plant as part of the plan to eliminate both hourly and salaried positions at the site. The company said it will cut jobs at other sites over the coming weeks.
-Darrell Proctor is associate editor for POWER (@DarrellProctor1, @POWERmagazine).
The post GE Will Cut Another 13,000 Jobs appeared first on POWER Magazine.