Sometimes the best thing to do is sit tight. That's the call General Electric Co. made after seven months of shopping its appliances division to buyers around the world while also laying alternate plans to spin off the whole commercial and industrial division of which it is part. A GE statement announcing that the
separation would be postponed until conditions improve cited the "challenging economic environment."
The postponement was good news in Louisville, Ky.,
home base for the division. A spokesman for the mayor, quoted in The Courier-Journal, said: "In today's economy, holding on to what you have is a victory."
By the fall the difficulties were becoming obvious. Appliance rivals such as Whirlpool Corp. and Electrolux AB have announced layoffs amid a terrible housing market. So has GE Appliances itself, though the unit will earn $300 million to $400 million in 2009. CEO Jeff Immelt did his best to
drum up interest among many possible buyers around the world. But Qindao Haier Ltd. of China was reportedly
put off by market conditions in the U.S. South Korea's LG Electronics demurred too.
But here's an intriguing note on LG. Current conditions notwithstanding, LG is expanding its appliance business in the U.S. According to a Reuters report last week, it just opened a new facility in Atlanta to support its commercial air-conditioning products. The company is also pushing ahead on lower-priced washing machines in the U.S. -
Kenneth Klee
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