GE Aviation plans to cut 13,000 jobs as coronavirus hits demand
Washington — General Electric said on Monday it was planning to cut the global workforce of its aviation unit in 2020 by as much as 25%, or up to 13,000 jobs, including both voluntary and involuntary layoffs, citing prolonged aircraft reduction schedules caused by the coronavirus pandemic.
The job cuts are the latest mounting woes for the aviation sector that are now expected to last into 2021 as US passenger air travel demand has fallen by 95%.
Last week, Boeing said it would cut 10% of its global workforce, or 16,000 jobs, as it has slowed some production rates, while supplier SpiritAero Systems said on Friday it is cutting another 1,450 jobs in Kansas.
GE Aviation shares were down 4% on at $6.23.
The GE Aviation job cuts are part of the $3bn in cost and cash savings announced by the company in April and include previously announced cuts, including a 10% cut to its US workforce announced in March.
GE Aviation CEO David Joyce told employees on Monday the “deep contraction of commercial aviation is unprecedented, affecting every customer worldwide. Global traffic is expected to be down about 80% in the second quarter”.
GE Aviation previously issued furloughs affecting about 50% of its US maintenance, repair and overhaul employees and new engine manufacturing. It also imposed a hiring freeze, cancelled a salaried merit increase and dramatically reduced non-essential spending.
Neither GE nor Boeing opted to apply for government assistance from a $17bn US Treasury fund for national security related companies. Boeing said it would rely on $25bn raised in a new bond offering.
Boeing CEO Dave Calhoun said last week he expected it would “take two to three years for travel to return to 2019 levels and it will be a few years beyond that for the industry to return to long-term growth trends.”