(Adds details about purchase of Alstom, shares of GE)
By John Revill
ZURICH, Dec 7 (Reuters) – General Electric Co said
On Thursday it is reducing 12,000 jobs in its global energy business,
the last effort of the industrial conglomerate that struggles to reduce
in itself in a more focused company.
The US company United States, whose shares have sunk 44 percent this
year, launched the cuts to save $ 1 billion in 2018, saying that
decrease in the expected demand of fossil fuel power plants for
GE did not give a detailed breakdown of job cuts, which
they represent about 4 percent of their workforce in general, saying only
that would be mainly outside the United States.
The announcement overshadowed GE's decision to spend
9.7 billion euros ($ 1
in the Alstom energy business of France. The deal
he intended to complete the GE Power portfolio by adding steam
turbine capabilities to its natural gas turbine power mainly
But the purchase came just when the demand for new power plants
was decreasing, partly due to competition from wind and solar energy
"Traditional electricity markets, including gas and coal, have
softened, "said GE on Thursday, explaining the decision for the
Rumors of job cuts were confirmed by the union
sources on Wednesday, with staff in Switzerland, Germany and
Great Britain among the hardest hit.
"This decision was painful but necessary for GE Power
respond to the disruption in the energy market, which is driving
significantly lower volumes in products and services, "he said
Russell Stokes, head of GE Power.
"Power will continue to be a work in progress in 2018. We hope
market challenges to continue, but this plan will position us
for 2019 and beyond. "
GE shares, part of the Dow Jones industrial average,
They rose 0.5 percent to $ 17.75 in early trading.
GE's new CEO, John Flannery, summed up last month
plans to reduce GE's extensive business empire built by
predecessors Jeff Immelt and Jack Welch, whose strategy was
based on the dispersion of risk in a wide range of industries.
GE previously said that it would come out of his enlightenment,
transport, industrial solutions and electrical network
business. It also plans to get rid of its 62.5 percent stake in
oil service company Baker Hughes.
In the dismissals on Thursday, almost a third of the
It could cut to 4,500 strong Swiss workers, while 16 percent of
the staff in Germany is also likely to be fired.
In Britain, around 1,100 positions will be affected, the
said the company. GE globally employed 295,000 people worldwide in
at the end of 2016, according to the company's website.
GE said he had begun talks with labor leaders about the
The union leaders in Germany reacted angrily to the job cuts.
"GE's announcement that it wants to cut thousands of
jobs across Europe is not strategically or economically
justifiable, "said Klaus Stein, the representative of the IG
Metall Union at the GE plant in Mannheim.
"We are not going to accept this, and we will fight … for
preserve jobs. "
The demand for new thermal power plants decreased dramatically in
all the rich countries, said GE, while customers of traditional services
have reduced their investments due to the deterioration of the market and
uncertainty about future measures of climate policy.
Almost no new power plant project had been commissioned
in Germany in recent years, said GE. Higher level of Asia
competition had also increased pressures on prices.
The slowdown has not only affected GE. Rival Siemens
is cutting around 6,900 jobs, or about 2 percent of
its global workforce, mainly in its energy and gas division,
which has been affected by the rapid growth of renewable energies.
($ 1 = 0.8478 euros)
(Reporting by John Revill; Editing by Michael Shields and Nick