Alstom cuts jobs in Chattanooga gas turbine plant

After taking a reorganization decision recently, Alstom has announced that it will lay off 80 of its 150-person work force at its new $300 million gas turbine manufacturing plant in Chattanooga, Tennessee, which was opened in 2010 and shipped its first unit in 2011. Citing a lack of orders for nuclear power components, Alstom's turbomachinery plant will slash its workforce to just 60 employees by year's end, an official said.

Last year, Alstom officials at varying times had put the plant's workforce at between 230 and 270. And as late as last August, during a visit by U.S. Sen. Bob Corker, R-Tenn., the plant's then-chief said the company was on pace to hit a target to 320 jobs by early this year.

Tim Brown, Alstom's communications director, said Friday the planned-for nuclear resurgence, which the 350,000-square-foot plant was built to tap, has been slow to come about. He blamed the Fukushima, Japan, nuclear power plant accident two years ago for helping dampen growth in the energy segment since then. He said, "The ultimate driver is that people are not ordering new nuclear. There's not the demand for nuclear [that there was] when we built the factory."

He also cited the emergence of plentiful and relatively cheap natural gas from U.S. shale reserves. Brown said the Chattanooga plant will refocus on existing needs in the power industry. That includes work for coal- and gas-fired power plants as well as nuclear, he said.

On March 14, Liquidators of PricewaterhouseCoopers in Birmingham, U.K., held the final disposition meeting in the case of the insolvency of Alstom Power Industrial Turbine Services. Several subsidiaries of Alstom have been barred from World Bank projects for three years due to a track record of investigations and convictions in bribery and corruption scandals worldwide.

In spite of steady growth in excess of 3 percent for the gas turbine industry as a whole, with growth up to 10 percent in some developing regions, Alstom seems to have hit a snag. Moving ahead, Brown said Alstom will adapt to market conditions. Plans are to preserve the entire plant's industrial capability for "when the market rebounds" and there are added opportunities, he said.

Until then, the factory will provide machining, assembly and balancing operations for steam turbines in existing nuclear and coal plants as well as make equipment for natural gas facilities.