Electric Boat plans to cut 1,000 more jobs next year
December 5, 2006
GROTON, Conn. -- Submarine builder Electric Boat will likely cut about 1,000 positions, or about 10.5 percent of its work force, next year due to a decline in work, company President John Casey said Tuesday.
The company hopes to make the reductions primarily through attrition and furloughs that would allow employees to maintain their benefits while out of work temporarily.
"If we can do that through attrition, I'll feel good about that," Casey said at the company's annual legislative breakfast. "Obviously I'd like to be hiring 1,000 people."
Last year, Casey warned that the company could slash as many as 2,400 jobs this year, but the company ended up only cutting 1,442 through attrition and layoffs.
The number dropped in part because of increased maintenance work.
The company, a division of General Dynamics Corp., now has 9,500 employees and expects to be down to 8,500 by the end of next year.
Submarine advocates have been pressing the Navy to boost production from about one to two ships a year. But Casey cautioned Tuesday that winning that battle in the short term will be tough because of all the competing military needs, so the company must prepare to be successful even if production is not increased.
"Two per year is important," Casey said. "It isn't clear to me what the path is to get there today."
Electric Boat is hoping to get business as a result of a plan launched Monday by British Prime Minister Tony Blair for a new multibillion-dollar submarine-based nuclear missile defense system.
Electric Boat is also trying to cut costs, especially health care expenses, by emphasizing prevention programs. The company plans to go smoke-free in the coming months.
The company survived a scare when the federal Base Closure and Realignment Commission voted last year not to close the nearby submarine base in Groton, where the company works closely with the Navy.
Electric Boat has seen tough times before. After the end of the Cold War, the company's work force fell to about 8,000 people.
General Dynamics shares rose 46 cents to close at $75.76 on the New York Stock Exchange.