GE plans to restructure businesses stir uncertainty
November 13, 2017 11:46 PM
General Electric’s plans to downsize and cut costs are stirring uncertainty worldwide and in the Capital Region.
“The market value of GE went from over 250-billion dollars at the beginning of the year to almost 160 billion dollars as of today,” said financial expert Steven Bouchey of Bouchey Financial Group, which is located in Troy, NY.
GE CEO John Flannery met with investors Monday and announced a restructuring plan that includes more of a focus on health care, aviation and energy.
The future of other sectors such as transportation and lighting are less certain.
Bouchey said GE's Schenectady plant could be effected.
“The Schenectady facility and other offices around the Capital Region area including Pittsfield Massachusetts will be effected somehow some way,” Bouchey said.
One of the ways could be layoffs.
“GE has 300-thousand employees around the world,” Bouchey said. “This will really change the landscape of how many people will stay employed especially locally.”
“It’s really sad to know that some families are going to be absolutely devastated,” said Max Martin, who co-owns Morrette’s King Steak House in Schenectady.
GE is also cutting its quarterly dividend in half.
“Now that's going to be cut down to 2.5 percent, the reason why, because the business can't afford to pay those dividends anymore,” Bouchey said.
The announcement follows last month's news that the Boston-based company is shedding 20 billion dollars of assets.
GE’s ties to Schenectady go back about 125 years.
Despite the possibility of more layoffs, Mayor Gary McCarthy said GE is here to stay.
“We're trying to make sure that they can bring other work there,” McCarthy said. “We're trying to make sure that they can continue the great relationship that they've had with the city of Schenectady.”
Layoffs at GE’s Schenectady plant could also mean a loss of traffic for small businesses like Morsette’s.
But Martin is optimistic.
“I think the town will be ok,” Martin said. “This town's been through a lot of bad things. And I think one company laying off people around here isn't going to do too much damage.”
Flannery said the restructuring plans are part of the company’s efforts to make GE simpler and stronger.
Updated: November 13, 2017 11:46 PM
Created: November 13, 2017 11:33 PM
Copyright 2017 - WNYT-TV, LLC A Hubbard Broadcasting Company