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Electrolux deal brings concern in GE Appliances’ hometown

Electrolux’s $3.3 billion purchase of GE Appliances announced this week means thousands of factory workers across the country are waiting to see what happens to their jobs, as the company works to integrate its appliance-making business.

Charlotte is home to Stockholm-based Electrolux’s North American headquarters, and CEO Keith McLoughlin has said the city will remain as headquarters for the combined company. McLoughlin told the Observer on Monday that “the opportunity in Charlotte just got better.”

But one place that could see profound changes is Louisville, Ky., where GE Appliances has been based for decades – and Kentucky officials said this week that they’re prepared to fight to keep the company’s jobs in that state.

“I’m sure we’ll make our case that the operations here in Louisville are strong and should stay here and grow,” said Kent Oyler, CEO of Greater Louisville Inc., the city’s chamber of commerce. “I’m sure Charlotte will make the same case.”

The company is one of the biggest employers in Kentucky, with about 6,000 workers and $370 million worth of payroll based at GE’s Appliance Park factory and headquarters. Of those, 3,700 are hourly manufacturing employees.

The 900-acre campus, where GE broke ground in 1951, churns out household appliances such as water heaters and dishwashers. The site also houses GE Appliances’ divisional headquarters.

Oyler said the company’s Louisville roots go deep, and many people in the city know someone who works at Appliance Park. His wife and sister used to work there, and his brother is a GE engineer.

Oyler said he knows there will be some redundancy between the companies. “It’s so early in the discussion that we’re not sure, and I’m sure Electrolux isn’t sure, what goes where,” he said. “I’m sure there’s overlap.”

Louisville Mayor Greg Fischer’s spokesman said Fischer has met with Electrolux officials, but wouldn’t say what they discussed. When the deal was announced Monday, Fischer said GE Appliances is “part of the heartbeat of our city, in the DNA of our city.”

Larry Hayes, secretary of the Kentucky Cabinet for Economic Development, told The Courier-Journal in Louisville that Kentucky’s governor plans to lobby Electrolux officials to keep and grow local jobs. “We always have concerns when there’s a change in ownership,” Hayes said.

Electrolux spokeswoman Eloise Hale said it’s too early to say what jobs might move where.

“It’s too soon to determine this, and we won’t know until we have regulatory approval,” said Hale. The deal isn’t expected to close until mid-2015.

Electrolux moved its North American headquarters to Charlotte in 2010 and employs 925 people in its University City-area facilities. The company said in December that it plans to grow its local employment to 1,600 by the end of 2017, part of an $85 million expansion.

The combination of Electrolux and GE Appliances, the No. 2 and No. 3 appliance makers in the U.S., would create a company with market share to rival No. 1 appliance maker Whirlpool. After the acquisition, Whirlpool and Electrolux would control about 75 percent of the U.S. appliance market between them, according to data from IBIS World.

Factory consolidation?

Beyond their headquarters operations, Electrolux and General Electric both have extensive manufacturing operations in the U.S. In the Southeast, Electrolux employs about 500 at a dishwasher plant in Kinston, 1,900 at a refrigeration manufacturing plant in Anderson, S.C., and 1,000 people at its oven plant in Memphis, Tenn.

Many of those factories have counterparts at GE. The company makes laundry machines, dishwashers, refrigerators and water heaters in Louisville, cooking appliances in LaFayette, Ga., and refrigeration equipment at Selmer, Tenn., Decatur, Ala., and Bloomington, Ind.

Electrolux also has product design, engineering and testing jobs at its Charlotte facilities, including a computer-assisted design center that can show a three-dimensional virtual model of a potential product. GE Appliances houses research and development at its Louisville campus.

Hale said Electrolux plans to maintain GE’s research and development facilities. “There is no doubt that GE Appliances’ current R&D activities will remain an important part of Electrolux Group once we have regulatory approval and the deal closes,” she said.

“We’re ‘wait and see’ right now” said Randy Brown, president of the Lenoir County Manufacturers Association, where the Kinston dishwasher plant is located. “They’re one of the largest (employers) here locally.”

Electrolux said Monday that it plans to “optimize” the combined manufacturing operations, but didn’t elaborate.

Oyler, of Louisville, said Charlotte is a “great town.” The city was the destination for the Louisville chamber’s annual intercity visit in June. They visited the Mint Museum, met city leaders such as Hugh McColl Jr. and Mayor Dan Clodfelter and took in the NASCAR Hall of Fame.

They didn’t visit Electrolux’s University City headquarters, however.

“Maybe we should have,” Oyler said.

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