Thread regarding General Electric Co. layoffs

GE Aviation to rightsize engineering

In the last call with investors GE Aviation CEO said:

"Yes. Look, on our guidance for segment margin, as you know, we continue to ramp LEAP. And LEAP is going to mix adversely in our commercial portfolio. Why? We've been building CFMs for the last 20 years. We're down that learning curve a number of times, and the cost -- plus, there's unbelievable amount of volume, so the cost -- including the aftermarket. So the -- fundamentally, we're at entitlement and for quite a few years on the CFM product line. Now we're transitioning to the next generation, which is LEAP. Not only are -- we are beating our cost curve in production, but as we get more volume, we get more product out there, we do more service, that cost just continues to come down. You should think about 1.5% to 2% per year. So this mix shift is going to be with us for a little time. That being said, we're offsetting it to the best of our ability. Just with the increase in the service business, military looks good. I mean, if you take a look at the markets, again, we're guiding flat, but we're optimistic. We really are optimistic. We've got very positive win rates in our military programs, and we continue to see a strong commercial market. Now in 2020, don't forget, we start to introduce the 9X. So now we have to go through the transition of the GE90 to the 9X starting in 2020. And we'll see that for the first time in 2020 with about 150 basis points of pressure on the business, again, offset by the strength of the aftermarket as well as military and our ability, quite frankly, to rightsize engineering for the future of our commercial programs, in addition, to transition those folks for more opportunities to actually improve this forecast in the military side."

Do you think "rightsize" engineering means layoffs?

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| 1076 views | | 9 replies (last )
Post ID: @Y5M73TJ

9 replies (most recent on top)

Translation: get as many FTE’s on funded programs as humanly possible without triggering a DCMA/GOA investigation, and then gut the rest.

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Post ID: @Y5M73TJ-3pts

Yes. Right sizing is absolutely necessary. The rush to production of the LEAP engines (to avoid the loss of emerging share and to the promise to customers to steer them away from competition), saw the size increase in the work force. Unfortunately, there is a disproportionate amount of EBs, with all the returning emigrants and GRC "KIcked ups" becoming VPs and chiefs of critical orgs such as supply chain, scale up, ....; All they managed was to hire more and create their own little empires!

First step should be to take a closer look at these EBs and "hang around Chiefs" and get rid of the "nonproductive, not needed anymore"s.

With the sale of LEAP in progress , more emphasis should be on programs to reduce its ICV (not much can be done to reduce CMC matls & process cost) and develop a good technical service team to be able to hit the road running when needed.

Repair & services will be critical for the new engine offerings - LEAP and 9X and this area should be emphasized and resized upward...

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Post ID: @Y5M73TJ-2rru

The meaning of rightsize in the dictionary means: to reduce the size of by eliminating staff positions, specifically when business conditions necessitate such a reduction.

So if he means it literally, layoffs can be assumed to happen in the near future.

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Post ID: @Y5M73TJ-1dds

I'd like one of them to say, "Well...., we wrongsized before but now we are going to rightsize."

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Post ID: @Y5M73TJ-1kij

“Rightsize” is like “climate change”...means everything and therefore nothing

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Post ID: @Y5M73TJ-1nmv

Given that the floodgates of voluntary attrition are wide open with sprung hinges, I wools doubt layoffs could be a concern.

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Post ID: @Y5M73TJ-1clc

What needs to be "rightsized" in the company is the excess number of E band employees.

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Post ID: @Y5M73TJ-1etx

Rightsize always means layoffs. If they meant hiring they would have said so.

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Post ID: @Y5M73TJ-ihr

It's a buzzword. One that investors like to hear. GE management is always trying to "rightsize". Everyday. Sometimes they "rightsize" by hiring. Sometimes they "rightsize" by hiring AME's to get cost out. Sometimes they "rightsize" by laying off. You shouldn't be surprised to hear the buzzword "rightsize". The only people who would be surprised are people who don't work at GE. Do you?

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Post ID: @Y5M73TJ-ngo

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