GE confirms division for sale; no guarantees for Appliance Park
GE confirms division for sale; no guarantees for Appliance Park (Source: WAVE 3 News)
Dr. Stephan Gohmann (Source: WAVE 3 News)
LOUISVILLE, KY (WAVE) - Appliance Park's 6,000 plus workers turn out enough refrigerators, water heaters and washers to make General Electric the world's third-largest manufacturer of such hard goods.
So what would GE get by selling to #2 Electrolux?
“GE would get out of a market it no longer considers core-strategy,” said Dr. Stephan Gohmann, BB&T Professor of Free Enterprise in the University of Louisville's College of Business. “Electrolux has pretty good market in Europe, but it hasn't been growing. They want to come to the States because there's a lot more construction going on.”
Gohmann says GE's $800 million reinvestment in Appliance Park offers no guarantees that Electrolux or any other potential buyer would keep production in Louisville or spare the workforce from job cuts. But the company's actions after buying appliance maker Frigidaire may offer clues.
“They invested $650 million dollars in that factory, over a ten year period,” Gohmann said. “That's an indication they wanted to expand in that particular area. Electrolux executives have offered no comment beyond the statement it issued Thursday confirming its negotiations.
“No agreement has been reached, and there can be no assurances that an agreement will be reached. Any further announcements will be made in due course,” the statement read. But Electrolux is not the only bidder, according to published reports.
Upstart Quirky is best known for its television ads in which its Chief Executive Officer is depicted tied to a speeding train, or giving a supplier a foot massage. The latter commercial promotes Aros, “a very smart air conditioner that learns your habits to save you money,” which is made in partnership with GE. But GE spokeswoman Kim Freeman says Quirky has no ties to First Build, a mini-factory recently opened on Uof L's campus that promotes similar entrepreneurial efforts.
First Build is seen as a further commitment to Appliance Park and GE's presence in Louisville.Quirky executives have not responded to telephone calls or emails seeking comment.G-E's national union contracts expire next June. Job security will be a big part of the renegotiations. But Eric Sims, President of IUE/CWA Local#761 says the only “heads-up” he could give his member came from GE, only hours before it admitted it was indeed, negotiating with Electrolux.
“I'm just telling everybody, keep doing what you're doing,” Sims said in a telephone interview Friday. “It's out of our control, so it's business as usual.” UofL's Gohmann agrees.
“Until something happens, or somebody says something, it's just speculation,” he said.