GE remains committed to adding 1,000 net jobs as part of the terms of its November acquisition of Alstom, though this round of cuts could chop up to 10,000 positions worldwide.
General Electric announced Wednesday that it plans to cut as many as 6,500 jobs in Europe, all 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 that said up to 10,000 jobs could go worldwide.
The industrial giant completed its acquisition of the power and grid businesses of Alstom back in November for a reported 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 honor, 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.
In order to secure the deal for Alstom’s prized gas turbine unit — a large, lucrative business with long-term contracts and income stream in a sector in which GE was already the world leader, it had to create three new joint ventures covering renewable energy, electricity grids and nuclear power.
The French government, which has a veto over sales in strategic sectors of the economy, was concerned about losing the industrial base for key nuclear power technologies and was sensitive about job losses as the country’s economy sputters.
The GE spokesman said the company would begin talks with French labor unions about the job cuts, saying they would come through voluntary departures and retraining would be offered to those in affected positions. He said GE never hid its plans to cut some support positions.
Union representatives criticized that, having now taken over Alstom, the only thing GE was doing was announcing job cuts.
“Where is the investment plan?” asked Laurent Santoire, of the CGT union.
The GE spokesman said jobs would also be cut in non-European countries as part of this restructuring, driven by the disarray in the energy industry due to the plunge of oil and gas prices, but declined to confirm the 10,000 figure in the L’Est Republican.
“Over the long term,” he said, “we remain convinced that the marriage between GE and Alstom will make us stronger to confront this market.”
The deal beefed up GE’s energy division to 65,000 employees in more than 120 countries. Alstom is now focusing on its rail business including its TGV high-speed trains.
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, with 1,219 more in Switzerland, 467 in Spain and 250 in Italy.
By Martine Pauwels
Copyright Agence France-Presse, 2016