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GE sees strong demand, new accountability: Immelt

General Electric Co is experiencing "tremendous demand" for its core industrial products, including gas turbines and aircraft engines, the head of the largest US conglomerate said.

July 14, 2011 / 10:54 AM IST

General Electric Co is experiencing "tremendous demand" for its core industrial products, including gas turbines and aircraft engines, the head of the largest US conglomerate said.


"Business is good. You have this backdrop of tremendous demand," Chief Executive Jeff Immelt told reporters and employees at the company's turbine-manufacturing factory in Greenville, South Carolina on Wednesday.


GE is expecting a particular pickup in demand for those natural-gas burning turbines, he said, citing an "incredible convergence around natural gas in Europe."


Immelt, who President Barack Obama tapped in January to head a council of US CEOs that advise the White House on jobs and the economy, said he now feels more accountable for where his company employs people.


"Big companies like GE are accountable for where our jobs are," Immelt said. "We're still going to put jobs outside the United States if it's important to gain access to markets but people are going to hold us accountable for where we put jobs and they make a statement about the company."


In all, GE employs about 287,000 people worldwide, some 133,000 of whom work in the United States. It expects to generate 60% of its revenue outside the United States this year.


The US manufacturing sector was hard hit in the last downturn, shedding 2 million jobs, or some 14.6% of its workforce. Today it employs about 11.7 million people -- down 34,000 since the recession's official end in June 2009.


The nation's stubbornly high unemployment rate, which ticked back up last month to 9.2%, is shaping up to be one of the key issues contenders for next year's US presidential election are focused on.


Even as the widely watched Standard & Poor's 500 index has rebounded from its recessionary lows, corporate America has continued to slash jobs, with companies ranging from Lockheed Martin Corp, Goldman Sachs Group Inc and Campbell Soup Co all making hundreds of layoffs in the past few weeks.


But Immelt said the company's domestic facilities remain highly competitive, in part because rising commodity costs and productivity improvements mean that labor now represents just 10-20% of the cost of making a turbine or jet engine.

"America can compete," he said at the sprawling 1.5 million square-foot (139,400 sq metre) facility. "Every unit that gets manufactured in this plant this year has one thing in common. They are not going to be sold in the United States. Every unit that we manufacture in this site this year is going to be exported."



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