Lights out for 1,400 GE workers

General Electric Co., founded by incandescent bulb developer Thomas Edison, said Thursday that it planned to cut about 1,400 jobs in its lighting division as the company closes plants in the United States and Brazil amid a consumer shift to more energy-efficient fluorescent lamps.

About 425 jobs will be eliminated in Ohio, where GE will shut six of its 26 U.S. lighting factories, spokeswoman Kim Freeman said. The company also will close a plant in Rio de Janeiro, eliminating 900 jobs and ceasing all lighting operations there. Some work being done in Mexico and the U.S. will be transferred to unspecified GE locations, affecting 80 additional employees.

Sales of traditional bulbs are slowing by at least 10% a year, said James Campbell, head of GE’s consumer and industrial unit. The rate of decline will accelerate, while revenue from technology such as compact fluorescent lighting is up by a “very strong double-digit” percentage, he said. Congress is considering legislation that may do away with incandescent lights.

“It’s really consumer buying patterns,” Campbell said. “We’re really trying to be aggressive here and take the lead, restructuring the plants and right-sizing ourselves to leverage what we see in the market.”

General Electric will pay for the job cuts and plant closings from the $500 million in proceeds tapped for restructuring after Chief Executive Jeffrey Immelt sold the company’s plastics unit in August. Campbell didn’t disclose the cost of the lighting restructuring. Immelt is shedding slower-growing businesses including the sub-prime mortgage unit to help boost profit growth.

The job cuts account for about 6% of GE’s 25,000 lighting employees worldwide and will take place over about three years, Campbell said. In the U.S., GE has about 7,000 lighting employees. It had 319,000 employees at the end of last year.

GE already has cut about 3,000 jobs at the lighting division in the last year and invested $200 million in newer technologies in the last four years, Campbell said. That signals a commitment to invest in, rather than to sell, the unit, he said.

The lighting division was forecast to have about $3 billion in sales this year, GE said. The parent company was projected to have about $172 billion in sales, the average estimate of 15 analysts surveyed by Bloomberg.

General Electric shares rose 15 cents to $41.70.