This morning General Electric announced to staff in their Power division plans for a consultation period on proposals for an organisational restructure.
The market conditions have had a significant impact on GE’s economic performance. Demand for new built power plants dramatically dropped in all OECD countries. Traditional utility customers have reduced their investments due to market deterioration and uncertainty about future climate policy measures.
Today’s actions are driven by challenges in the power market worldwide. Traditional power markets including gas and coal have softened. Volumes are down significantly in products and services driven by overcapacity, lower utilization, fewer outages, an increase in steam plant retirements, and overall growth in renewables. To get back to competitiveness GE Power needs to remove cost substantially from its businesses.
In the UK, these proposals will primarily impact activities in Stafford and Rugby.
Mark Elborne. President and CEO GE UK & Ireland said:
“Regrettably, the proposed changes would have an impact on jobs in the UK.
“These are not proposals we ever make lightly and we understand that this news will be difficult for many people. Unfortunately, we believe that these changes are necessary to ensure that we can remain competitive and secure the future of GE Power in the UK.
“We have shared our proposals with employees’ representatives today and will now begin a consultation period before any final decisions are made.”
In total, the proposals potentially impact approximately 1,100 positions across all parts of the UK GE Power business, including Power Digital and Global Operations. This represents about 6% of total GE workers in UK.
These proposals are in response to changing market conditions; the worldwide power and grid segments are essentially flat, with regions such as Western Europe experiencing a decline. This increased pressure in the marketplace, coupled with intense competition and continuing pricing pressures, means GE Power has been working to eliminate costs, remain competitive and prepare for 2018 and beyond.
This proposal to restructure the Power business would simplify, consolidate and improve the efficiency of the R&D organisations across all product lines; implementing strategies to improve productivity and efficiency of its technology.
Mark Elborne. President and CEO GE UK & Ireland goes on to say:
“GE remains committed to the UK, which will continue to be a strategic market for GE. We have almost 18,000 employees working at 65 sites in UK. Following this proposed restructure, we would remain one of the top five industrial companies in the country.”
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Notes to editors
- Today GE has almost 18,000 employees working in 65 sites in UK. GE in UK as a whole exports over 8B£ of goods and services annually and accounts for 1.5% of UK total exports.
- The sites GE are proposing to close would not affect their value to export. GE will remain one of the top five industrial companies in the country.
- The UK would remain a strategic market for GE. It is in the top three markets for GE in Europe.
- Stafford would remain one of the Top 10 sites in Europe for GE in UK employing over 800 employees and hosting three grid centres of excellence in HVDC, UHV power transformers and grid automation.
- IRS - Interim Representation Structure: European representation structure for legacy Alstom employees.