Thread regarding General Electric Co. layoffs

How many turbines do we have in Greenville next year?

A family would never stock a refrigerator for 6 people when a family size reduced from 6 to 2. They'd cut back by 2/3's and so too will Power, with their labor where orders are 30-40% of what they were 2 years ao, , by 2/3's.

@1pvy You are spot on, except that they are set up to make xxx GTs but only sold x. They couldn't even get into the double digits. They are going to be under HUGE pressure to get rid of all the excess capacity.

I doubt you could jettison Power even if you wanted to. Nobody will buy it in total except the Chinese, and they can’t for national security reasons. Certain parts are very valuable, others not so much. Even those that are valuable might not generate as much cash as one would like. The fundamental problem is that the valuable parts have to generate enough cash to pay legacy costs while also reinvesting in the business to keep it running and developing new technology to keep it competitive. There is no legal way to separate the good parts of the business from the legacy liabilities, except for bankruptcy, and you can’t just put the bad parts of the business into bankruptcy, you have to do the entire business, which the court would laugh at.

That said, only selling xx new GTs when you are sized to make xxx new GTs is the immediate problem that needs to be addressed. Same principle applies to other products of course.

GE is losing cash at rate of ~$1B every 5 weeks ($19B to $14B in last six months).

That is $50M for per workday. +/-

All units except Power are making money. So, it is costing a lot for GE to stay in Power business.

GE board has to look at divisions as investments. Will they buy Power unit if it were up for sale today? If they think they can find better investments elsewhere (e.g., S&P500), they should sell Power. Imagine a different CEO who could have spun off GE Power but kept Aviation, HC, O&G, Transportation. GE stock would be in 30s today.

Weird twist of fate, could Honeywell buy GE now and jettison Power unit? They could do wonders with Aviation, if they can get past Anti-trust.

the era is over. adjust your portfolio.

GE Will Be Dead Money for a While| Quarterly results left Wall Street disappointed and signs of progress in the power division are likely far away

https://www.wsj.com/articles/ge-will-be-dead-money-for-a-while-1532101453

Exactly on point... Let the Bodies Hit the Floor... This is especially since GE is nearly out of businesses to sell. Once they are down to the remaining core businesses that they must keep to protect the pension liabilities and bond payments and are bound by the agreements with the French government then their only choice will be non-Europe layoffs for most part since it will be very hard to layoff those in Europe with their labor protections.

Also, anyone in Global Operations should be making plans as well at this point since when many of the businesses were sold recently the GGO people were not allocated back to those businesses and instead only have a TSA support to them for 12-18 months and then the work will move to the company's who bought the divisions recently sold.

Additionally, with the spin off of Healthcare and sale of Baker Hughes look for Global Ops people to get shrunk down as those businesses decide on best cost approach which might include moving work to other 3rd parties vs. the shared services remaining in GE. John has placed a $500MM "Bulls Eye" on anyone in shared services.

It appears the House of Pain will continue for all part of GE.