General Electric Furloughs Half of Engine-Manufacturing Staff in Aviation Unit

The moves by General Electric could idle thousands of workers for four weeks.
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General Electric  (GE) - Get Report said it was furloughing half of the engine-manufacturing staff for its aviation unit. 

The moves could idle thousands of workers for four weeks, the company told CNBC.

The company already announced last week that it was dropping 2,600 employees from the aviation unit, or 10% of the unit’s workforce.

The coronavirus has devastated the aviation industry as very few people are flying, and the General Electric unit already was under pressure before the coronavirus outbreak from the grounding of Boeing’s 737 MAX jet after two fatal accidents. General Electric builds engines for those planes.

“Due to the unprecedented impact of Covid-19 on the commercial aviation industry, GE Aviation is implementing a temporary reduction in commercial engine assembly and some component manufacturing operations for up to four weeks,” a General Electric spokesperson told CNBC.

“We appreciate the commitment of all our employees during this difficult time, and we regret having to take this action. We will continue to deliver for our customers and preserve our capability to respond when the industry recovers,” the GE spokesperson added.

GE’s aviation unit has shined in recent years, even as the overall company has struggled amid problems in the power and financial services units and excessive corporate spending. The company slashed its quarterly dividend to 1 cent per share.

General Electric shares actually enjoyed a strong comeback from Dec. 3 to Feb 10, soaring 90%. But since then they have plunged 46%. At last check, GE shares traded at $6.92, down 1.7%.

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