Louisville, Kentucky-based GE Consumer & Industrial announced it intends to restructure its lighting business to become more competitive and better positioned for global growth in the dramatically changing lighting industry. This restructuring proposal, which would impact plants in Mexico, Brazil, and the US, is a continuation of structural changes that have occurred over the last year and included facility closures, work transfers, employee reductions, and the sale of operations at GE sites in Europe, China, Indonesia, the US, Latin America, and India that have impacted more than 3,000 positions.
The objective of the proposed restructuring is to help the business better respond to customer and industry demands—particularly the global market move to more energy-efficient products—and invest in and deliver the high-tech lighting products increasingly in demand by customers around the world.
The announcement would affect a number of facilities and positions globally, including the closing of all lighting operations in Rio de Janeiro, Brazil, impacting approximately 900 jobs, and the closing of some lighting operations in the US, impacting approximately 425 jobs, with a portion of those jobs being transferred to other GE Lighting facilities in the US, and the transfer of some operations from facilities in Mexico and the US to other GE locations or suppliers, impacting about 80 positions. GE will be discussing this restructuring proposal with its employees and, where appropriate, employee representatives before reaching any final decision. These actions are part of the company’s previously announced restructuring activities. GE Consumer & Industrial will continue to assess other structural changes that may be necessary to ensure the long-term competitiveness of its lighting business.
“The restructuring we are proposing, while very difficult due to the impact on employees, would be one of the most important things we’ve done in the 100-plus-year history of GE’s lighting business,” explains Jim Campbell, president & CEO of GE Consumer & Industrial. “We are proposing these actions in order to continue our leadership in an industry that is in the midst of significant change. Global market demand for the most common household lighting product, the incandescent bulb, has dramatically declined over the past five years and is accelerating due to new efficiency standards and technology advancements.
“In addition,” adds Campbell, “our historical model of making most of the components we need for our lighting products ourselves is no longer effective in today’s global economy. In many cases, we can now purchase the components we need at a more competitive cost than we can make them. It doesn’t make sense for us to continue with an inefficient model. The proposed plan would allow us to continue to reinvent our production model to use our global factory more efficiently and effectively.”
The business is also focusing on new products and investing in new lighting technologies and R&D that will help its oldest business maintain its market and technology leadership.
“We are increasing our focus on the development and production of new, innovative lighting products like LEDs, organic LEDs, our new high efficiency incandescent light bulbs, and other products that our customers will increasingly demand and require. In the last four years alone we have invested more than $200 million on energy-efficient lighting.”
“The time to refocus and realign our lighting business is now. We have a responsibility to employees, customers, and shareowners to run our operations as competitively and efficiently as possible,” Campbell says. “We also have a responsibility to help minimize the negative impact of these proposed actions on affected employees, should they occur. We take that responsibility very seriously and with our excellent benefits we intend to help our employees make a successful transition during this period.”