GE prepares to cut 1,000 jobs in LM Wind Power, Indians could be hit as well

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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General Electric (GE) is planning to cut 1,000 jobs across functions and geographies in LM Wind Power, its renewable energy business, as per an internal communication seen by Moneycontrol. The move will likely affect its Indian staff as well, company insiders have said.

The downsizing, expected to begin in the coming weeks, comes at a time when the competitive landscape has made it difficult for GE to deliver renewable energy profitably.

The cost-cutting deliberations started in January when GE Renewable Energy’s LM Wind Power business CEO Olivier Fontan told employees that the company planned to be a leaner, smaller and more profitable division within GE Vernova over the coming months.

“As you are all aware, the wind industry is fighting a tough battle to continue to deliver competitive renewable energy in a profitable manner. Due to the market challenges, it is necessary for us to evolve our structure to regain our competitiveness,” Fontan told employees in an email on January 22, a copy of which Moneycontrol has reviewed.

GE acquired Denmark-based LM Wind Power in 2017 for $1.65 billion.

LM Wind Power, which primarily manufactures rotor blades for wind turbines, is a part of GE Vernova. Power, electrification and acceleration are the other divisions of GE Vernova, which aims to decarbonise with renewable energy resources.

Headwinds

As part of its plans to become a more efficient business, LM Wind Power will solely focus on external customers.

The move, even as the magnitude of it remains undecided, will impact staffers in India as well, company insiders said.

“While we cannot share the details of the proposals at this stage, if implemented, these proposals could potentially have a net impact of approximately 1,000 role reductions globally, primarily in global functions,” Fontan’s January email said.

LM Wind Power did not reply to Moneycontrol’s email seeking details of the plan.

Since January, around the time when news about the restructuring was first communicated, GE Vernova has been engaging with the Renewable Energy Business Committee of the European Works Council (EWC) to consult on a proposed reorganisation of the LM Wind Power business.

Those consultations ended earlier in March and layoffs will now follow, the company told employees.

“We will consider the outcome of the EWC process as we continue to engage meaningfully with our employee representatives at local levels. As a result, within the next weeks, potentially impacted roles at a global level will be communicated,” a company email on March 26 said. Moneycontrol has reviewed a copy of the mail.

The company has a presence in Denmark, Spain, Poland, Canada, China, India, Brazil, the United States and many more countries, according to its website.

It began operations in India in 2007 and has more than 200 engineers in the country, LM Wind Power’s website says. It has two blade factories in India, a key market for the company.

The company will hold an all-employee broadcast around the end of April, or early May where it will shed light on the future organisation and its integration plan. It will help affected employees transition within or outside GE Vernova, the March email said.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow