GE to cut jobs in imaging unit due to falling sales
Mark L. Vachon, GE Healthcare president and CEO for global diagnostic imaging, expects sales of big ticket items to be down for 2009. Image Source: GE Healthcare  
Mark Vachon, president and CEO of GE Healthcare Global Diagnostic Imaging business, told Reuters that its diagnostic unit will reduce costs and cut jobs.

Vachon told Reuters that he expects sales of big-ticket imaging equipment to be down “in the mid-single digits” percentage points in the United States in 2009, compared to last year.

While he declined to provide the reduction size or a time frame, Vachon said that there is “no question that, given this market, we're going to get much tighter on costs.” He added that spending cuts will include job reductions, Reuters reported.

The American Hospital Association (AHA) recently published a report, noting that 45 percent of U.S. hospitals surveyed said that they were delaying purchases of clinical technology or equipment, and 39 percent were putting off investments in new IT.

Vachon admitted to Reuters that is “anxious about the U.S. market,” but noted that losses in the United States are mitigated by stronger sales in other markets.

Reuters reported that GE’s diagnostic unit generates more than half of its revenue outside the United States. Sales in China will likely be up 5 percent to 10 percent in 2009, while sales in Eastern Europe and Russia would probably see double-digit sales growth rates, according to Vachon. Western Europe would likely generate sales growth in the lower single digits next year, while Japan should be stable in 2009, he added.

He said 2009 will be “a challenging environment for all industries, healthcare included.” However, he also told Reuters that he expects conditions to improve in 2010.