Ge Jet Engine On Boeing 777 First Flight Cancelled Jason Redmond Afp Via Getty Images

GE Cuts 10% of Aviation Staff as Virus Hammers Airliner Suppliers

March 23, 2020
Elsewhere in aviation manufacturing, Boeing announced plans to suspend production at its Puget Sound facility.

In an open letter to staff issued Monday, March 23, GE CEO Larry Culp announced that General Electric Co.’s aviation division would be reducing its workforce by 10%. Based on numbers included in GE’s 2019 annual report, the announced cut could impact as many as 5,200 workers.

In addition, Culp’s letter included a notice of a 90-day “lack of work” period affecting 50% of GE Aviation’s maintenance, repair and overhaul employees. Culp also announced he would forgo his personal salary for the remainder of 2020, while Aviation Division leader David Joyce would forgo half.

The measures announced today, according to Culp, add on to existing efforts to cut costs in GE’s aerospace sector. Those included implementing a hiring freeze, cancelling a salaried merit increase, and reducing “non-essential” spending.

In his letter, Culp noted how the ongoing coronavirus outbreak was affecting aviation industry particularly harshly. “The rapid contraction of air travel has resulted in a significant reduction in demand as commercial airlines suspend routes and ground large percentages of their fleets,” he wrote. Culp also noted, however, that other sectors would have to “adjust” as well. He noted that GE Healthcare was working to increase its manufacturing capacity in the wake of surging demand for ventilators and other medical devices.

A week ago, Boeing Co. issued a statement calling for the government to provide $60 billion to airlines, airports, and aerospace manufacturers. “Funds would support the health of the broader aviation industry,” the statement said, allowing manufacturers to pay suppliers and maintain supply chains threatened by a lack of demand. Boeing, which sources engines from GE Aviation, announced March 23 that they would suspend production at their Puget Sound, Washington plant.

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