GE: An Update on the Challenge of COVID-19
March 23 2020 - 9:15AM
Business Wire
GE (NYSE:GE) Chairman and CEO H. Lawrence Culp, Jr., today
issued the following message to GE employees:
Team,
As COVID-19 continues to spread, the leadership team and I
remain focused on three areas during these unprecedented times:
protecting the safety of our employees, continuing to serve our
customers in their critical time of need and preserving the
strength of our businesses. Today, I am writing to you to give you
an update on the latest steps we are taking to aggressively
mitigate the impact of the pandemic, starting with GE Aviation.
The aviation industry is feeling the impact of this global
pandemic most acutely. The rapid contraction of air travel has
resulted in a significant reduction in demand as commercial
airlines suspend routes and ground large percentages of their
fleets. As a result, GE Aviation is announcing several steps that,
while painful, preserve our ability to adapt as the environment
continues to evolve.
GE Aviation is announcing plans that impact its U.S. population,
while the business works with the appropriate parties to properly
address its global workforce:
- GE Aviation is planning to reduce approximately 10% of its
total U.S. workforce.
- There will be a temporary lack of work impacting approximately
50% of its U.S. maintenance, repair and overhaul employees for 90
days.
- These actions build on those the business already has taken,
including a hiring freeze, the cancellation of the salaried merit
increase, a dramatic reduction of all non-essential spending, and a
significant decrease in its contingent workforce.
- Starting April 1, David Joyce, vice chairman of GE and
president and CEO of GE Aviation, will forgo half of his
salary.
Taken together, we expect these cost and cash actions will
preserve $500 million to $1 billion in 2020.
As David Joyce wrote in his note to GE Aviation employees
earlier, “Our hardworking, determined employees are the heart of
our business, and it is difficult to have to take these steps due
to external factors like this. But we must respond immediately with
every action within our control to protect our ability to serve our
customers now and as the industry eventually recovers.”
I feel the same way. That is why I will forgo my full salary for
the remainder of 2020.
GE Aviation is not alone in the challenges it faces. Each GE
business and Corporate will need to adjust. For example, GE
Healthcare is managing through reduced demand for certain equipment
as elective procedures are postponed or canceled around the world.
At the same time, our GE Healthcare team is working heroically to
increase manufacturing capacity and output of equipment – including
CTs, ultrasound devices, mobile X-ray systems, patient monitors and
ventilators – important in the diagnosis and treatment of COVID-19
patients. I know our business teams are working hard to understand
our new realities.
With regard to our financial position, our company is sound.
However, what we don’t know about the magnitude and duration of
this pandemic still outweighs what we do know. Closing the sale of
BioPharma to Danaher will help us solidify our financial position
further, and in a critical milestone last week, we announced that
we have satisfied all required regulatory clearances and expect to
close the transaction on March 31.
I also want you to know that we are supporting efforts by the
U.S. government to preserve the aviation industry and protect the
broader economy, and we have not sought any provisions in stimulus
bills that would benefit GE exclusively.
While it doesn’t make today’s news easier, I want to remind you
what a different financial position we are in currently thanks to
your efforts to strengthen our company over the past years. We have
endured crises before, though of a very different nature and on a
very different scale. But just as we did then, this organization
continues to show tremendous grit and resilience and we will come
out of this stronger. Thank you for your hard work during this
difficult time.
Larry
Caution Concerning Forward-Looking Statements
This document contains forward-looking statements – that is,
statements related to future events that by their nature address
matters that are, to different degrees, uncertain. For details on
the uncertainties that may cause our actual future results to be
materially different than those expressed in our forward-looking
statements, see
https://www.ge.com/investor-relations/important-forward-looking-statement-information,
as well as our annual report on Form 10-K. We do not undertake to
update our forward-looking statements.
About GE
GE (NYSE:GE) rises to the challenge of building a world that
works. For more than 125 years, GE has invented the future of
industry, and today the company’s dedicated team, leading
technology, and global reach and capabilities help the world work
more efficiently, reliably, and safely. GE’s people are diverse and
dedicated, operating with the highest level of integrity and focus
to fulfill GE’s mission and deliver for its customers.
www.ge.com
GE’s Investor Relations website at www.ge.com/investor and our
corporate blog at www.ge.com/reports and @GE_Reports on Twitter, as
well as GE’s Facebook page and Twitter accounts, contain a
significant amount of information about GE, including financial and
other information for investors. GE encourages investors to visit
these websites from time to time, as information is updated and new
information is posted.
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version on businesswire.com: https://www.businesswire.com/news/home/20200323005359/en/
GE Investor Contact Steve Winoker, 617.443.3400
swinoker@ge.com GE Media Contacts Tara DiJulio, GE,
202.213.6855 tara.dijulio@ge.com Mary Kate Mullaney, GE,
202.304.6514 marykate.nevin@ge.com Perry Bradley, GE Aviation,
513.375.2597 perry.bradley@ge.com
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