GE Aviation to furlough 50% of its engine manufacturing staff

CNBC's Phil LeBeau reports that General Motors will increase the number of layoffs from 10 percent to 50 percent of its engine staff. The staff will be furloughed for up to four weeks.

General Electric is planning to furlough half of its aviation unit’s engine-manufacturing staff as the coronavirus roils the industry, the company told CNBC. The move would involve thousands of jobs in the important unit and last for four weeks.

The additional reductions come less than a month after the company said it would cut 10% of its aviation unit, affecting roughly 2,600 workers. But the coronavirus’ devastating toll on travel demand has increased and airlines are parking hundreds of planes while deferring orders of new aircraft.

“Due to the unprecedented impact of COVID-19 on the commercial aviation industry, GE Aviation is implementing a temporary reduction in commercial engine assembly and some component manufacturing operations for up to four weeks,” a GE spokesperson said. “We appreciate the commitment of all our employees during this difficult time, and we regret having to take this action. We will continue to deliver for our customers and preserve our capability to respond when the industry recovers.”

The aviation industry’s struggles is expected to hurt demand for both travel and new aircraft this year, which hurts top GE Aviation customers like Boeing and its European rival Airbus.

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