General Electric (GE) has announced plans to shut down a foundry as well as cut more than 250 jobs at its Lufkin oil-field services unit in, Texas, US, amid dropping global oil prices.
The decision to close the foundry and 262 axe jobs at the two Angelina County, Texas, sites is driven by the reduction in demand for drilling equipment made by GE’s unit Lufkin Industries due to the plunging oil prices, reported the Wall Street Journal.
GE Oil & Gas spokesman Laura Bauer was quoted by KTRE as saying cited in a statement: "As a result of increasingly challenging market conditions, we have made the decision to close the Foundry and reduce positions at Buck Creek.
"This was a tough decision to make, but one we must make for the long-term health of the business."
GE Chief Financial Officer Jeffrey Bornstein told Wall Street Journal in July that the drilling equipment demand dropped 40% in the second quarter for Lufkin Industries.
GE acquired Lufkin Industries, the maker of oil-pumping and drilling equipment, in 2013 for $3.3bn.
GE has set a target to reduce $600m investment this year in oil and gas division, reported Reuters.
Earlier this year, the company announced its plan to cut 575 Lufkin jobs.