General Electric (NYSE:GE) on Tuesday warned of more job cuts at its aviation unit, citing a lengthy recovery for the airline industry from the impact of the coronavirus crisis.
The job cuts are the latest setback for the aviation sector, with the industry’s woes expected to last into 2021 even as U.S. regulators ended a 20-month grounding of Boeing Co’s (NYSE:BA) Max 737 jets and Covid-19 vaccine developers reported positive data.
In an internal video message delivered on Friday, GE’s aviation unit head John Slattery said additional job cuts would be a component of those options, a company official said.
The Boston-based conglomerate in May announced plans to cut the global workforce at its aviation unit by as much as 25% in 2020, or up to 13,000 jobs, citing prolonged aircraft reduction schedules caused by the pandemic.
Through the quarter to end-September, GE had reduced about 20% of its aviation workforce and realized close to $1 billion in cost savings.
Last month, the company said it was "actively monitoring" the pace of demand recovery to ensure the business was "appropriately sized" for the future.
Revenue at GE’s aviation unit, its largest, fell 39% in the third quarter while aviation orders more than halved during the period, with a 60% decline in both commercial engines and commercial services.
This has compounded the troubles at GE’s aviation unit, which makes engines for Boeing and Airbus and had already been reeling from the grounding of Boeing’s 737 Max planes.
The Wall Street Journal first reported the development.
The company’s shares were down 1.5 cents at $10.44 early Wednesday.
