GE to cut 6,500 jobs in Europe after Alstom acquisition

Back in September I predicted that GE would cut about 8,000 jobs (12%) after the Alstom acquisition. It looks like my analysis was not too far off as GE announced today that 6,500 jobs in the energy units would go just in Europe. Possibly the total number of jobs cut worldwide within 12 – 18 months will have to exceed 10,000 if GE is to come close to the cost reductions it has promised its shareholders.

YahooNews:

General Electric said Wednesday it plans to cut up to 6,500 jobs in Europe in the energy units it acquired from France’s Alstom last year.  

“The restructuring plan will touch several European countries and impact potentially 6,500 jobs out of 35,000,” a GE spokesman told AFP, confirming in part a report in the L’Est Republican newspaper saying up to 10,000 jobs could go worldwide.

The US industrial giant completed in November its acquisition of the power and grid businesses of Alstom for 9.7 billion euros ($10.5 billion) after making a number of pledges to win the support of the French government and fend off competition from rivals like German company Siemens.

One of those pledges was to create a net 1,000 high-skilled jobs in France, a promise that GE intends to honour, the spokesman said, despite 765 jobs due to go in France as part of this restructuring.

French government spokesman Stephane Le Foll said it would monitor the company’s implementation of its commitments. …….

… GE hasn’t provided any details about the job cuts in Europe, but L’Est Republican said 1,735 posts in Germany were slated to go, 1,219 in Switzerland, 467 in Spain and 250 in Italy.

It looks like Germany and Switzerland will bear the brunt of the cuts. I was expecting Baden in Switzerland to be hard hit but had perhaps underestimated the “French protectiveness” which disadvantages Germany. Still Siemens may be able to pick up some very good people in Germany and elsewhere (though the market is not exactly in a very expansive mood).

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