A bullish George Oliver, vice-president and general manager of GE Engine Services, says that his company will buck the post-11 September downturn being experienced in the commercial aviation industry. He spoke to propulsion editor Geoff Thomas.
Q: How large is your business and what impact will world terrorism, post-11 September, have on it?
A: We're a $6.4-billion company and we're growing nicely, albeit with the main expansion opportunities currently on the military side.
This will continue to be the case for the foreseeable future and I anticipate that world terrorism will have a relatively minor impact - maybe 5% overall - and that we'll outperform the market.
Once our current restructuring is complete, we'll return to double digit growth from 2003 onwards.
What has happened so far is close to our ‘worst case scenario' although we hope that by getting closer to our customers and understanding their problems and challenges, we will be able to help them through it.
Maybe the eventual outcome will be less serious than we predicted - but we have seen no signs so far of any significant improvement.
Q: How come you appear to be bucking the trend?
A: Well, our installed base of GE engines has doubled over the past decade and I anticipate that it will double again over the coming 10 years.
The initiative by the airlines to take out around 20% of the world's fleet of airliners concerns mainly older, less-efficient aircraft and anyway, additions featuring our engines are greater than retirements.
Q: What business strategies have you adopted to help you through this difficult time?
A: Our entire strategy is designed to enhance our capability for growth.
Firstly comes customer service; secondly comes operational excellence; while last, but by no means least, comes technology. We aim to help our customers to win: it's as simple as that.
And our entire company has concentrated on this philosophy for the past 18 months.
Q: But what does this actually mean for customers?
A: We're trying to drive out variations in service quality by leveraging best practices, particularly in our six CFM-56 shops worldwide.
Over the past 18 months our customers have spent almost $500 million on upgrading their CFM-56s, improving fuel burn, increasing time on wing, and gaining lower maintenance costs resulting from condition-based servicing.
It has become a genuinely ‘smart' engine and our customers show their appreciation by registering a 15% improvement in their levels of satisfaction with our product.
Q: What's happening on the military front?
A: Believe it or not, around 75% of all the aircraft deployed in the Afghanistan arena are GE-powered and we're hugely involved in both service and upgrades.
Some engines have been in use for 30 or 40 years and we're helping the US government to reduce servicing costs while enhancing mission availability and reliability. I can see significant double-digit growth in our military servicing operations over the coming years.
Q: What about your operations in the Asia-Pacific region?
A: In recent years, GE Engine Services' presence in Asia has grown from a single operation in Singapore to a complete network of regional facilities. We now have companies and joint ventures in Malaysia, Xiamen in China, Japan and Korea which form an important part of our global network of 60-plus facilities serving more than 200 customers.
In this region, we employ more than 1,300 people and they deal with engine overhaul and repair as well as component repair, airfoil refurbishing and on-wing support.
We also have the largest CFM56 service provider in Asia (in Malaysia) and the region's most advanced test cell, with up to 150,000lb thrust capability, in Xiamen.
Q: And the future?
A: The future's bright: make no mistake. We're concentrating on digitising the business and this means fewer ‘manual touches'. This, in turn, enhances customer satisfaction and transforms how we work in our own ‘backroom'. We're focusing on adding value and by doing this we're improving our performance across the piece. And our customers appreciate it."
Source: Flight Daily News
