December 7 (Renewables Now) - The Power business of US conglomerate General Electric (NYSE:GE) today announced a plan to axe roughly 12,000 jobs around the world in response to the disruption in the power market.
GE Power said that with this move the company will beef up its global competitiveness and added that the job cuts are part of efforts to reduce overall structural costs by USD 3.5 billion (EUR 2.97bn) this and next year.
The company pointed at the overall growth in renewable energy as one of the reasons why traditional power markets such as gas and coal are experiencing significant volume reductions in products and services. The other reasons mentioned include overcapacity, lower utilization, fewer outages and an increase in steam plant retirements.
“Power will remain a work in progress in 2018. We expect market challenges to continue, but this plan will position us for 2019 and beyond,” GE Power president and CEO, Russell Stokes, commented. According to Stokes, GE Power continues to be a strong business at its core, with a backlog of USD 99 billion. He noted that the plan is to make the company simpler and stronger.
The announcement comes less than a month after GE chairman and CEO John Flannery said the group intends to exit more than USD 20 billion worth of assets in order to focus on three businesses: power, aviation and healthcare.
GE Power’s announcement says that the planned job cuts will affect both professional and production employees.
(USD 1.0 = EUR 0.848)