June 1, 2019 / 11:09 PM / 25 days ago

GE says French plant set for layoffs will not close down

PARIS (Reuters) - A General Electric (GE) factory in eastern France where the U.S. group is planning job cuts will not close down, and the firm is looking into alternatives there including building aeronautical parts, GE’s French boss said in a media interview.

FILE PHOTO: The logo of U.S. conglomerate General Electric is pictured at the company's site of its energy branch in Belfort, France, February 5, 2019. REUTERS/Vincent Kessler/File Photo

Plans announced last Tuesday for over 1,000 potential layoffs, mainly targeted at the Belfort plant, prompted France’s Economy Minister Bruno Le Maire to say he would fight to save jobs at the site as negotiations kicked off with unions.

GE had said the move was aimed at making its operations more efficient in France in response to a shrinking market for power plants. Belfort handles gas, steam, nuclear and hydro technology.

In an interview published on Sunday in France’s Journal Du Dimanche, Hugh Bailey, the general manager of GE in France, said Belfort’s sales of gas turbines had halved between 2017 and 2018 and the group was struggling to remain competitive.

“That said, I want to be clear, Belfort will not close,” Bailey was quoted as saying. “It will remain GE Power’s number one industrial site in Europe.”

Bailey said gas power still had a future but added other areas that were developing rapidly - such as renewable energy and energy storage - could also be key.

He said GE businesses in other countries could be affected by the restructuring, though he did not give details.

“GE’s difficulties in energy are well known. When it comes to this (job cut) project, the announcement is part of a global decision, which is then adapted on a European level, country by country,” Bailey told the JDD.

French industrial group Alstom was Belfort’s biggest employer until 2014 when it sold its gas turbine manufacturing business to GE, which pledged to create 1,000 jobs to win backing for the deal from the French government.

However, the company had to break that commitment as the gas turbine power plant market collapsed. In February GE agreed to pay 50 million euros ($56 million) into a reindustrialization fund for falling short of the target.

Reporting by Sarah White; Editing by Chris Reese

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