General Electric’s Aviation to Cut 10% of Workforce as Air Travel Demand Freezes

General Electric’s (GE) aviation unit said it will cut 10% of its U.S. workforce as most air travel has to come to a halt in response to the global coronavirus pandemic.

In addition, Chief Executive Officer Lawrence Culp announced in a letter to employees that he will forgo his full salary this year. The company expects cost-cutting measures and cash actions to translate into $500 million to $1 billion in savings in 2020. General Electric’s “financial position is sound”, Culp said in the letter.

Wall Street analysts are slightly cautious about recommending General Electric as 9 have a Buy rating on the stock and 6 have a Hold rating, adding up to a Moderate Buy consensus rating and an average price target of $12.65 per share.  Should the target be met, shares could be in for a 107% twelve-month gain. (See General Electric’s Stock Analysis on TipRanks)

Shares of the company on Monday fell to the lowest level in at least five years, tumbling 6.3% to $6.11 in U.S. trading.

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