General Electric Co. is retrenching in the two-way mobile communciations business, saying that competition and high production costs are hurting sales of its mobile phones and cellular radio equipment.
The company is laying off 750 workers, about one-quarter of its work force, at its mobile communciations plant in Lynchburg, Va., where GE is the second-largest employer.
"We're really looking at realigning the business, and what I mean by that is restructuring to improve our competitive position," said Toby D'Ambola, employe relations manager at the Lynchburg plant. "Our costs are just way out of line compared to our competitors."
In addition, like some others in the business, GE is finding out that the cellular telephone market hasn't materialized quite as expected. "While it's a good business, it hasn't done as well as we thought," D'Ambola said.
The first sign of GE's retrenchment came earlier this month, when the company shelved a long-awaited new two-way mobile communications system. The cutback will be felt the most in Lynchburg, a city of about 12,000 situated 180 miles southwest of Washington.
With 3,150 employes, GE is second only to power-plant equipment maker Babcock & Wilcox (3,700 employes), Lynchburg's main employer. GE officials say they are attempting to cushion the blow for those being put out of work.
GE has taken similar steps in other staff reductions and plant closings in recent years, even winning civic and editorial praise in some towns for the humanitarian way in which it has shut plants.
The company says it will be another week before it knows exactly which 350 salaried employes it will let go, and give them 30- to 60-day notice. The 400 hourly employes being laid off will be informed Dec. 14, and given a minimum of two weeks notice.
A company hired by GE will hold a three-day job placement seminar for the affected workers, and GE will attempt to place as many of the laid-off employes as possible in new jobs. The company is offering early retirement options to qualified employes -- 50 or 60 in all -- and may place others with other GE operations.
He expects the 100 or so technical experts to be laid off to be able to find jobs fairly quickly. "We won't have any trouble placing technical people," he said, although some may have to leave the area to find work.
D'Ambola said he expects that most of the salaried employes will be able to find new jobs inside or outside GE, or take early retirement. The remaining 50 or so "will be very hard to place."
Even harder to find jobs for are the hourly personnel to be cut, D'Ambola said. For the most part, they have few technical skills, and employment opportunities for such workers in the Lynchburg area are sparse, he said. "They may find jobs, but they'll be at lesser salary," he said.