General Electric (GE) is slashing 1,100 jobs across its UK operations, mainly in Stafford and Rugby, as part of a global cull that will see the conglomerate’s power business axe around 12,000 positions.
GE said that the move would allow it to save $1bn (£750,000) in costs by next year.
“This decision was painful but necessary for GE Power to respond to the disruption in the power market, which is driving significantly lower volumes in products and services,” said Russell Stokes, president and chief executive of GE Power.
“Power will remain a work in progress in 2018. We expect market challenges to continue, but this plan will position us for 2019 and beyond.”
GE has been hit hard by dwindling demand for fossil-fuel power plants, and Thursday’s announcement is the latest effort by the sprawling company to transform itself into a more focused business.
The company has previously said it would exit its lighting, transportation, industrial solutions and electrical-grid businesses. It also plans to ditch its 62.5 per cent stake in oilfield services company Baker Hughes.
Globally GE had around 295,000 employees worldwide at the end of 2016, according to its website.
The company also said that it had begun talks with labour-union leaders about the cuts.
“General Electric is in danger of cutting too far, too fast and leaving itself ill-equipped to meet the challenges of the changing power-generation market,” Unite national officer Linda McCulloch said in a statement.
“These proposals will be a shock for General Electric’s loyal workforce and deal a major blow to the Midlands’ economy which will be deprived of highly skilled, well-paid jobs because of this announcement,” she said.
She said that over the coming days and weeks Unite would be supporting its members.
“Unite will also be seeking guarantees from General Electric that there will be no compulsory redundancies and that there will be redeployment opportunities for workers wishing to stay with the business,” she said.
Mark Elborne, president and chief executive of GE for the UK and Ireland, said that the company remains “committed to the UK” and that it would continue to be a strategic market for GE.
“We have almost 18,000 employees working at 65 sites in UK. Following this proposed restructure, we would remain one of the top five industrial companies in the country,” he said.
Additional reporting by wires