ge aviation investor visit
TRANSCRIPT
Imagination at work.
May 12th 2014
GE Aviation Jefferies Investor Visit
This document contains “forward-looking statements” – that is, statements related to future, not past, events. In this context,
forward-looking statements often address our expected future business and financial performance and financial condition, and
often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” or “will.” Forward-looking
statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties that could
cause our actual results to be materially different than those expressed in our forward-looking statements include: current
economic and financial conditions, including volatility in interest and exchange rates, commodity and equity prices and the
value of financial assets; the impact of conditions in the financial and credit markets on the availability and cost of General
Electric Capital Corporation’s (GECC) funding and on our ability to reduce GECC’s asset levels as planned; the impact of
conditions in the housing market and unemployment rates on the level of commercial and consumer credit defaults; our ability
to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so; the
adequacy of our cash flow and earnings and other conditions which may affect our ability to pay our quarterly dividend at the
planned level; the level of demand and financial performance of the major industries we serve, including, without limitation, air
and rail transportation, energy generation, network television, real estate and healthcare; the impact of regulation and
regulatory, investigative and legal proceedings and legal compliance risks, including the impact of financial services regulation;
strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses; and numerous
other matters of national, regional and global scale, including those of a political, economic, business and competitive nature.
These uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking
statements. We do not undertake to update our forward-looking statements.
GE PROPRIETARY INFORMATION | Jefferies Investor Visit
GE Aviation 2
Business overview
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GE Aviation 3
“I find out what the world needs, then I proceed to invent it.”
– Thomas Edison
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GE Aviation 4
GE Aviation executive team
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GE Aviation 5
David L. Joyce President & CEO
Commercial Engines
W.A. Fitzgerald Vice President and General Manager
Military Systems
J. M. Lydon-Rodgers Vice President and General Manager
Sales & Marketing
C. A. Chahrour Vice President and General Manager
Supply Chain
C.B. Athans Vice President and General Manager
Chief Information Officer
T. Kantor General Manager
BGA & Integrated Systems
B.D. Mottier Vice President and General Manager
Effective: May 2, 2014
Marketing
L.C. Rouaud Chief Marketing Officer
Assembly, Test & Overhaul
A.J. Aiello
Vice President
Avio Aero
R. Procacci Senior Executive and
Avio Chief Executive Officer
Communications & GE Advantage
J.R. Regg Senior Executive
Services Engineering
J.M. Rosario Vice President
Engineering
M. Ehteshami Vice President and General Manager
Business Development
W.J. Godsman General Manager
Legal & Business Development
M.R. McAlevey Vice President
Technology & Sciences and
Chief Engineer G.D. Mercer Vice President
Services
K.G. McAllister Vice President and General Manager
CMCs Program
S.M. Correa Vice President
Avionics & Digital Systems
A.C. Caslavka Vice President
Aviation Systems and Digital Engineering
and Technology J.W. Daily
Vice President
Human Resources
E.W. Marshall Vice President
Finance
S.M. Wright Vice President and
Chief Financial Officer
Global Government Relations
P. Prowitt Executive Director
Attending
GE Aviation portfolio … $22B
Avionics and Digital Solutions $0.8
Power Transmissions
Turbo machinery
Avionics
Digital Services
BGA and Integrated Systems $1.5
Military engines and services $4.1
Commercial engine services $7.9
$0.8
General aviation engines
Power, mechanical, electronics
Commercial engines $6.8 –2) –2)
–1)
A leading provider of jet engines, services and systems
-1) Based on 2013 revenue
-2) includes GE’s share revenue from 50-50 CFM and EA joint ventures
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GE Aviation 6
Technical innovation … at our core
U.S. jet engine
U.S. turboprop engine
High bypass engine
Composite fan blade in airline service
120,000+ lb thrust engine
Modular power tile
FMS-controlled Unmanned Aircraft System
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GE Aviation 7
Powering the world’s airline fleets
Every 2 seconds, an aircraft
with GE engine technology* is taking off somewhere in the world.
At any given moment, more
than 2,200 of these aircraft
are in-flight, carrying between 50 and 500 passengers.
That's more than 300,000
people... right now... who are depending on our engines.
*Includes joint venture engines built by CFM and EA
CFM International is a 50/50 JV between GE and Snecma
EA is a 50/50 JV between GE and PW
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GE Aviation 8
Powering the world’s military fleets
2 of every 3 helicopters in the US
fleet are powered by GE
3 out of every 4 combat surface
vessels in the Navy’s fleet are powered by GE Aviation and all of the Navy’s carrier combat aircraft
Half of the bombers in the Air Force
fleet are powered by GE Aviation
2 out of every 3 fighters in the U.S.
fleet are powered by GE Aviation
Engine fleet: 24,900 GE PROPRIETARY INFORMATION | Jefferies Investor Visit
GE Aviation 9
*Includes joint venture engines built by CFM
CFM International is a 50/50 JV between GE and Snecma
*
Global revenues
Europe 30%
Pacific Basin 35%
Lat . America, Canada 11% MENAT
22%
Other 2%
Total U.S. Revenues -1
$9.2B
42%
Total Intl revenues
$12.8B
58%
-1) 2013 revenues
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GE Aviation 10
Global backlog
Europe 13%
Pacific Basin 41%
Lat . America, Canada 10%
MENAT 34%
Other 3%
U.S. backlog $31B
25% Intl backlog
$95B
75%
-1) 2013 backlog
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GE Aviation 11
-1
GE Aviation facilities around the world
North America
Canada
Mexico
U.S.A.
Asia
Australia
China
India
Japan
Korea
Malaysia
Singapore
Taiwan
Thailand
Europe
Czech Republic
France
Germany
Hungary
Poland
Romania
Turkey
United Kingdom
Italy
South America
Brazil
44,000 employees 79 manufacturing sites 11 Engineering centers
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GE Aviation 12
$3.5 $3.7
$4.3
'11 '12 '13
CAGR 8%
Deliveries
Installed Base
A great GE business ($ in billions)
• Grow installed base and services
• Lead in next-generation products
• Position supply chain for product volume growth
• Build out digital services for customer productivity
Revenue
Op profit
R&D
2,918 3,296 3,513
56,000 57,000 58,000
Strategic imperatives
$1.5B $1.6B $1.8B
$18.9
$20.0
$21.9
Deliveries and installed base includes GE and JV partners volume.
2012 Deliveries: GE 1,837; CFM 1,382; EA 77
2012 Installed base: GE 40K; CFM 18K; EA .2K
CFM is a 50/50 JV between GE and Snecma
EA is a 50/50 JV between GE and Pratt & Whitney
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GE Aviation 13
Cost efficiency ($ in millions)
Product cost-out
SG&A cost
2013 2012
$210 $200
2013 2012
1,410 1,465
7% 7% % revenue
• Delivering supply chain productivity
− Global footprint
− Lean, deflation, teaming
• P&L delayering and consolidation
− Disposition of 10+ sites since 2011
− Global shared services
2.5% 2.5% Productivity
Simplification
1) Excludes Avio acquisition SG&A
-1)
2011
1,490
8%
2011
$180
2.0%
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GE Aviation 14
Commercial engines
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GE Aviation 15
Commercial power for today … and tomorrow
*CFM, CFM56 and the CFM Logo are trademarks of CFM International, a 50/50 joint company of Snecma and GE **GE-P&W Engine Alliance is a 50/50 joint venture with Pratt & Whitney
EMBRAER 170/175/190/195
Bombardier CRJ200/700/900
ACAC ARJ21
Regionals CF34® Passport CT7
Single Aisle CFM56* LEAP*
Twin Aisle CF6 GEnx
Jumbo Twin Aisle CFM56, CF6/GEnx GP7200**, GE90, GE9X
Airbus A320 Boeing 737
Boeing 787 Airbus A300/310/330 Boeing 767
Airbus A380 Airbus A340-200/-300 Boeing 777 Boeing 747-200/-300/-400 Boeing 747-8
Saab 340 Global 7000/8000
Airbus A320neo Boeing 737 MAX Comac C919
Boeing 777X
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GE Aviation 16
CFM is a 50/50 JV between GE and Snecma EA is a 50/50 JV between GE and Pratt & Whitney
LEAP is a trademark of CFM International
-1) Production volume approx. 34% GE, 62% CFM, 4% EA
Commercial Equipment Growth Production volume # of GE and JV engines (-1
Source: IATA and GE analysis
Environment
Jet fuel ($/gal)
5.3 5.2
79 80+
310 298
2012 2013
Load factors (%)
Passenger demand (IATA, RPK % YoY)
2012 2013
2012 2013
2012 2013 2014F
Airline profits $Billions (IATA)
… airlines feeling good
12.9 7.4
In-service fleet # of engines ‘000
5.8
80+
2014F
2014F
293
2014F
18.7
'13 '15F '20F
3,300
2,600 3,000
’15F ’20F
15 16 18
18 20
26
44
33 36
’13
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GE Aviation 17
Commercial orders and fleets
Orders Backlog
2013
CEO(-1
Svs
13
9
2013
22
96 $22
$118
CFM is a 50/50 JV between GE and Snecma EA is a 50/50 JV between GE and Pratt & Whitney
-1) CEO orders $6.2 GE, $6.3 CFM, $0.1 EA CEO backlog $11.4 GE, $9.6 CFM, $0.7 EA
Europe
51% 47%
20% 11% In service Backlog
China
61% 46%
8% 22% In service Backlog
Asia
38% 36%
21% 8%
In service Backlog
0.4% 0%
North America
30% 50%
30% 14% In service Backlog
Latin America
45% 48%
20% 5% In service Backlog
Middle East
21% 24%
33% 21%
In service Backlog
7% 6%
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GE Aviation 18
($B)
Growth ahead of demand in all regions (Aircraft fleet in service)
CFM is a 50/50 JV between GE and Snecma EA is a 50/50 JV between GE and Pratt & Whitney
Traffic growth is between ‘13-32. Source: GE Aviation Marketing
~4,350 ~3,900 ~1,800
~1,750 ~2,300 ~800 ~600 ~1,050 ~800
~1,500 ~4,500 ~3,800
North America Europe China
Latin America Middle East Asia
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GE Aviation 19
’15F ‘12 ‘15F ‘12 ‘15F ‘12
‘12 ‘15F ‘15F ‘12 ‘15F ‘12
Traffic growth ~ 3%
Our growth 11% Traffic Growth ~ 3.5%
Our growth 17% Traffic Growth ~ 7.5%
Our growth 22%
Traffic growth ~ 5%
Our growth 30% Traffic Growth ~ 6.3%
Our growth 32% Traffic Growth ~ 4.8%
Our growth 30%
In Service
Fleet
In Service
Fleet
In Service
Fleet
In Service
Fleet
In Service
Fleet
In Service
Fleet
Commercial services growth
CFM is a 50/50 JV between GE and Snecma EA is a 50/50 JV between GE and Pratt & Whitney
Shop visits Environment Departures # departures (millions)
2012 2013
Source: IATA & GE analysis
Passengers (IATA, RPK % YoY)
Utilization Avg. cycles/ day, % YoY
-1% 0.9%
20 21
Departures GE & JV-powered flights (MM)
2012 2013
2012 2013
5.2% 5.3%
2014E
0.2%
22 2014E
2014E
5.8%
0
5
10
15
20
25
30
35
40
‘10 ‘15F ‘95 ‘00 ‘05
2 of 3 daily flights
powered by GE or GE JV’s
$96B Services backlog
4,100
5,500
4,400
’13 ’15F ’20F
2,100
2,000
3,000
2,300 2,000
2,300
200
100
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GE Aviation 20
Commercial product positioning Today’s
investment Today’s airline service
CFM is a 50/50 JV between GE and Snecma
EA is a 50/50 JV between GE and Pratt & Whitney
HF120 is made by GE Honda, a 50/50 JV between GE and Honda Aero, Inc.
LEAP is a trademark of CFM International
GEnx-1B GE9X
GE Passport HF120 H80
GEnx-2B
~13,700 engines (backlog)
LEAP-1A LEAP-1C LEAP-1B
Regional/ Business
Narrowbody
Widebody
Installed base (2015F)
9,600
000
6,600
20,
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GE Aviation 21
Embraer 170/175/190/195
Powering the world’s regional fleet
CF34 engines in service
4,600
5,000 5,100
'13 '15F '20F
156 operators
in 67 countries
73 M I L L I O N f l i g h t h o u r s
Bombardier CRJ200/700/900/1000
COMAC ARJ21
CF34 shop visit forecast
1,000 1,000
1,100
'13 '15F '20F
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GE Aviation 22
Preferred power for narrowbody
630 M I L L I O N f l i g h t h o u r s
CFM56 …
• 26,000 engines delivered
• 30+ years in service
• 34,000+ departures per day
Fleet in service
LEAP …
• 2016 service entry
• Selected by Airbus, Boeing, COMAC
• 6,300 orders and commits
• 9,000 a/c opportunity
15 L O W E R fuel consumption *
%
*Compared to today’s generation CFM56. Claims based on GE estimates
LEAP, CFM, and the CFM logo are trademarks of CFM International, a 50-50 JV between Snecma and GE
18,800
20,300
’14E ’20F
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GE Aviation 23
Superior fuel burn … today and tomorrow
• Best-selling widebody engine ever … 7,450 delivered
GEnx …
Airbus A380
43 Y E A R S
CF6 …
62%
W I N R A T E B o e i n g 7 8 7
i n s e r v i c e
• Fastest- selling GE widebody engine
• 1,835,000 hours flown
• 1,600 engines ordered
NEW ENGINE
deliveries beyond 2020
Engines in service
• 397 million hours flown
• ~750 shop visits in ‘14
• 1,600 a/c in operation
Claims based on GE estimates
GEnx win rate does not include undecided engine campaigns
~
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GE Aviation 24
630
2,100
'14E '20F
Technology leadership in big twins
41 M I L L I O N f l i g h t h o u r s
GE90 …
• 600 aircraft on order
• 1,700 engines in service
GE9X …
• Service entry end of decade
• Sole source on 777X
• 3,000 a/c opportunity
Most
advanced
engine
GE’s ever
designed 5% BETTER fuel efficiency
vs. ANY engine I N C L A S S
• With 65 operators
Claims based on GE estimates
Fleet in service
1,700
2,600
’14E ’20F
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GE Aviation 25
3
7 5 5
70's 80's 90's 00's 10's
Building on technology investment
Enabling …
• Engineering productivity 10%+
• Manufacturing technology readiness
• Supply chain efficiencies
Commercial launches
Delivering technology with customer confidence
GEnx LEAP & Passport GE9X
Scale and design for higher cycle utilization
Scale & design for higher thrust and advanced materials
2011 2015-2016 2020
60M
9
E N G I N E S H O U R S
6000 E X P E R I E N C E
LEAP is a trademark of CFM International, a 50-50 JV between Snecma and GE
Technology experience (engines/hours): CFM: ~4,000/~30MM, GE: ~2,000/~30MM
Commercial launches: 19 GE, 9 CFM, and 1 EA
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GE Aviation 26
Carbon-fiber composites … only GE
GE90-115B 777-200LR, -300ER, 777F
GE90-94B 777-200ER
GEnx 787, 747-8
GE9X Boeing 777X
• Swept aero
22 blades • Wide chord design
22 blades • Improved efficiency
18 blades • Improved materials
16 blades
‘95 ‘04 ‘11 ‘20
Extending to fan cases • Integrated structure
• Saves 700+ lbs per aircraft on 787
1 00+ million flight hours
2020 fan blade E X P E R I E N C E
Based on GE estimates
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GE Aviation 27
Compression technology … driving efficiency through pressure
GEnx 787, 747-8
GE9X 777X
Compressor pressure ratio
2011 2018 Cert
LEAP & Passport 737MAX, A320neo Global 7/8000
2015-2016
23-1 22-1 27-1
Performance claims based on GE estimates
LEAP is a trademark of CFM International, a
50-50 JV between Snecma and GE
1 4
technology platform …
product applications
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GE Aviation 28
Combustion technology
• Higher pressure, new standard in industry
DAC (GE90-94B) 777-200ER, 777F
TAPS I (GEnx) 787, 747-8
TAPS II (LEAP) 737 MAX, A320 neo
TAPS III (GE9X) Next-Gen 777
• Evolution in lean combustion
• Additive fuel circuit
• Set the industry standard
2015
1995
2008
2019
A 20+ year journey of proven innovation in combustion science, materials, and manufacturing
Leader in NOx technology
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GE Aviation 29
Turbine technology
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GE Aviation 30
GE90 777
GEnX 787, 747-8
GE9X Next-Gen 777
• Aero and cooling innovation
2008
• 3D Aero sets industry standard
1995/2004
• Advanced Ceramic-matrix composites
2015
Leading edge innovation … delivering best fuel burn LEAP
737 MAX, A320 neo
• Advancing Ceramic-matrix composites
• Advancing metals technology
2019
Ceramic-matrix composites (CMC) … next generation of innovation
CMCs are silicon carbide fibers in a silicon carbide matrix
Nozzles
Blades
Shrouds Combustor
Diameter of a human hair
LEAP is a trademark of CFM International, a 50/50 JV between Snecma and GE
better fuel efficiency 2,400°F 1/3 weight
of metal + = 500°F hotter than metal
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GE Aviation 31
Ceramic-matrix … only GE
GE9X
2020 1980 2000 2016
Research LEAP
2.3
Hours by 2019
Revenue service
Aviation HPT shroud
GE Power Turbine shroud
1
G E N E R A T I O N st 2
G E N E R A T I O N nd 3
G E N E R A T I O N rd
GE Frame 7
GEnx and T700
ADVENT and F414
Aviation HPT nozzles and blades
Product Development
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GE Aviation 32
M
Commercial services
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GE Aviation 33
Servicing our customers today and tomorrow
Service offerings GE & JV engines backlog
CFM/
LEAP
GEnx
GE90/
GE9x
CF6
CF34
GP7000 33,000 engine installed fleet
16,300 CFM56 engines. CFM is a 50-50 JV between GE and Snecma
120 GP7000 engines. GP7000 is a product of EA, a 50-50 JV between GE and Pratt & Whitney
New, Used, Repaired Material
Overhaul Time and material (T&M) overhaul
Asset Optimization
TRUEngineTM program
Analytics
Diagnostics
Risk Transfer $/hr comprehensive maint coverage
$96B
Production (years)
Services ($B)
4 $43
6 $6
2 $5
4 $27
6 $13
2 $2
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GE Aviation 34
Backlog
Industry leading product portfolio … today and tomorrow
CFM International is a 50/50 joint company between Snecma and GE Engine Alliance is a 50/50 JV between GE and Pratt & Whitney
CF34 8/10 powered regionals
40+ Years
Design and Test
New engines
GP7200-powered A380
GE90-powered Boeing 777
CFM-5/7 powered narrowbodies
CF6-80E powered
widebodies Engine lifecycle revenue
LEAP-powered narrowbodies
GE9X-powered Boeing 777X
GEnx-powered widebodies
Parts and Services
CFM-3 powered narrowbodies
CF34-3 powered regionals
CF6-80C powered
widebodies
CF6-6/50 powered
widebodies
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GE Aviation 35
'90 '10 '13
GE
CFM
‘90 ‘10 ‘13
Well positioned for services growth
CFM is a 50/50 JV between GE and Snecma
EA is a 50/50 JV between GE and Pratt & Whitney
GE Honda is a 50/50 JV between GE and Honda Aero, Inc.
Segment/geographic
Diverse fleet Large fleet Installed base 21,000 aircraft in ‘13
Engine maturity
Young fleet
1+ SV
0 SV
0 SV
1+ SV
NB
WB
RJ
TP
N.Am
L.AM
Europe
ME/Af
Asia
Type
Region
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GE Aviation 36
Total
fleet
CFM
7B/5B
fleet
GE Overhaul Shops
Snecma Shops
Network
Aligned network of global service partners
OEM
GE Celma
GE Malaysia
GE Strother
GE Wales
GE Caledonian
St. Quentin Brussels Morocco Mexico
CFM, CFM56, and the CFM logo are trademarks of CFM International, a 50/50
joint company between Snecma and General Electric Company
Network
CFM56
CF6
CF34/CT7
GE90
GEnx
• More than 8,000 employees in 10 countries
• 250 field service engineers
• 450 dedicated customer support representatives
• 400+ services customers worldwide
• 55+ years of experience (25+ years CFM)
• Network locations worldwide
Cincinnati McAllen, TX Terre Haute Hungary Singapore Singapore-ATI
GE Component Repair
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GE Aviation 37
EGAT
Installed base (‘13) Upgrades Fuel Burn Time-on-wing
CFM56 ~18,500 8 8% 2x
CF6-80C2 ~3,000 8 3% 3x
GE90 ~1,550 5 2% 2x
GE’s tradition: continuous product improvements to reduce customers’ cost of ownership
CFM is a 50/50 JV between GE and Snecma
I M P R O V E M E N T S
1995 EIS
1986 EIS
1984 EIS
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GE Aviation 38
Minds + Machines = customer productivity
Reduced maintenance burden Inspections tailored by serial number
Fleet segmentation
Engine and part specific duty cycle
Analytic based inspection limits … FAA approved
Operations optimization Zero unplanned downtime / disruptions
Avoid high cost failures
Predictive Analytics Advanced detection methods
Rapid data forensics + data sciences
Airline operations optimization
Flight Efficiency Services
Using analytics to identify operational savings
Improve airlines flight economics
Optimized policies and procedures via data fusion and analytics … fuel savings
Customer outcome Big data and predictive analytics
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GE Aviation 39
Military engines & services
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GE Aviation 40
Military … the affordable alternative
Proven power for DoD Total platforms
Global In-service fleet # of engines ‘000
30
25 26
Combat
Transports
Special
Marine
Helos
10
6
3
4
12
6
3
4
15
7
3
4
’15F ’20F ’14E
CFM ~2,300 ‘13, ~2,400 ‘15, ~2,600 ‘20
Source: Flight Global, GE analysis
Global position # of engines
15,700
14,000
22,600
2,300
2014 installed fleet
Rotorcraft
Combat
Large tanker/transport
*-a)
Bombers
Marine
61%
40%
51%
72%
64%
(a-includes aircraft with MTOW >150,000 lbs
6,211
3,403
1,584
160
143
FY14 FY15 President's Budget
581 575 War funding
Base
DoD budget ($ billions)
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GE Aviation 41
* CFM is a 50/50 JV between GE and Snecma
Upgrades to fleet improvement
Total engines
Opportunity Program
Black Hawk/Apache T700-701D
KC-135 F108 (CFM) C-PUP
•1.5% better fuel burn
•>600 fewer shop visits
• Life savings of $2B
• More systems power
• Life savings up to $5B
•20% thrust increase
Super Hornet/Growler F414 EDE
Value prop
6,500 $2B+
Rev
1,730
1,515
CFM is a 50/50 JV between GE and Snecma
•5% more power
•2-3X core life
• Army funded dev.
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GE Aviation 42
$1.5B
Rev
$3B
Rev
Helicopters … diversified growth
T-70/Black Hawk
GE-powered international military (installed engines)
3,200
‘12 ’20F
40%
4,400
AW149 AW101
NH-90 KUH-Surion
Operating in 32 countries
AH-64 Apache
T700 military derivative: CT7 power of choice
EIS ’13 1st flight ’14
525 Relentless S-92
EIS ’04
AW189
144
GE-powered oil & gas helicopters (installed engines)
‘12
570
’20F
4X
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GE Aviation 43
Leadership in rotorcraft …
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GE Aviation 44
Our newest family member … GE38
GE38
7,500 shp class
• 57%* more power
• 18%* better SFC
• 63%* fewer parts
Sikorsky CH-53K King Stallion
“US largest new rotorcraft system … new technologies … 3X lift capability of aircraft it replaces”
Aviation Week – May 5th
*Compared to engine it replaces (T64)
Next generation for rotorcraft
65% better
25% lower
35% lower
Specific Fuel Consumption
(SFC)
Cost
T700 baseline
More power in hot/high conditions
Lower fuel consumption
Lower operating costs
AATE (Advanced Affordable Turbine Engine)
FATE (Future Affordable Turbine Engine)
80% better
35% lower
45% lower
Power: weight
T55 baseline
• For Black Hawk and Apache
• For NextGen rotorcraft
Leadership in combat …
What is next gen combat propulsion? Adaptive cycle game changers
Enables adv weapons
Enhanced survivability
Increased thrust
Improved cooling capacity
ADVENT (Adaptive Versatile Engine Technology)
AETD (Adaptive Engine Technology Development)
Only Engine Mfg. awarded
BOTH contracts
Highest
combination of
pressure and
temperatures
ever achieved in industry ADVENT engine
Today …
High-bypass, highly efficient
OR
High performance Fuel efficiency
Low-bypass, high thrust
Future … Adaptive Cycle
AND High performance Fuel efficiency
• 3rd stream fan
• Advanced materials
• High energy core
• Advanced cooling
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GE Aviation 45
Building on technology investments
AETD (Adaptive Engine Technology Development)
30% better
25% lower
Fuel burn
Thrust Range
5th Gen baseline
10% more
Advanced aerodynamics & cooling
High temperature alloys
Ceramic Matrix Composites (CMC)
High efficiency core
Adaptive cycle & 3rd stream
High pressure ratio
Survivability technologies
Augmentor/exhaust nozzle
GEnx
LEAP
GE9X
F136
ADVENT
CFM is a 50/50 JV between GE and Snecma
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GE Aviation 46
Commercial engines
Military engines
Aviation systems & Business and general aviation
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GE Aviation 47
2 global business Positioning for growth Worldwide presence
North America
United States
Canada
Europe
United Kingdom
France
Poland
Asia-Pacific
China
Australia
Singapore
GE Aviation systems solutions
Integrated Systems
Electrical power
Mechanical
Unison
Avionics & Digital
Core Avionics
Digital Systems
787: $1.0MM/aircraft
A350: $1.0MM/aircraft
A380: $1.5MM/aircraft
F-35: $1.6-1.8MM/
aircraft
G650: $0.4MM/aircraft C919:
$3.0MM/aircraft
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GE Aviation 48
Flight Management System (FMS)
5 product areas …
• Flight planning • Flight optimization, performance
Computing and networking
• Centralized computing hardware • Remote interface network units
Displays
• Head-down displays • Standby instruments
Vehicle Health &
Data Mgmt (VHDM)
• Aircraft data recording • Aircraft health monitoring
Mission Systems
• Payload deployment • UAV refueling, landing
Key programs, pursuits
$400M+ $450M+ $140M+ $300M+
C919 KC-46/C-130/P-8 B777X Typhoon B737/A320 upgr.
$700M+
FMS
Computing
Displays
Opp’ty
Avionics overview … GE portfolio
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GE Aviation 49
Growth in China
• 250 engineers in Shanghai
• Tier 1 avionics … hardware and software
development, and integration
Launch platform … COMAC C919 … EIS 2017
China, Asia-Pac … key growth
Deliveries next 20 years*
35% Asia-Pac
N. America
Europe
Other
20%
23%
22%
Asia-Pac fleet size*
2011 2031
4,700
13,700 ~3x
* Boeing estimate
Core computing
Networking
Displays
Flight Management System On-board maintenance
Engines
Integrated propulsion
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GE Aviation 50
Integrated systems Differentiated solutions for military & civil platforms
Power Unison Mechanical
• Aircraft power … generation, distribution & conversion
• Air management systems … valves, air starters
• Thermal management
• Tubes & ducts
• Electrical components …
• Ignition, sensors, FADEC power
• Propellers
• Aero structures
• Landing gear & actuation
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GE Aviation 51
Electric Power … airplane “smart grid”
Power conversion
Primary power distribution
Secondary power distribution Generation
Battery systems
Emergency power
Environmental controls
Advanced propulsion
Integration labs … US & UK
Where we are competing and winning
• Primary & distributed power … G650
• Primary power on … 75% large UAVs
• Backup power on … 777X
• Power System on … JSF
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GE Aviation 52
… Applying GRC innovations
Business & General Aviation engines
*GE Honda Aero Engines LLC is a 50/50 joint venture between GE and Honda Aero Inc.
CFM, CFM56 and CFM logo are trademarks of CFM International, a 50/50 joint company of Snecma and GE.
GE Honda* HF120
M601, H80
CF34 Turbofan
Passport 20
Bombardier Challenger 605
HondaJet
LET L410 Thrush 510G King Air 90 (Retrofit)
Bombardier Global 7000 Bombardier Global 8000
Bombardier Challenger 850 Bombardier Challenger 870 Bombardier Challenger 890 Embraer Lineage 1000
CFM56-5B
Airbus A319 Boeing Business Jet
CFM56-7B
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GE Aviation 53
CAIGA TP150
Nextant Aerospace G90XT
Expanding in growing segments
AIR-TEC L410 Upgrade Thrush Aircraft 510G
Aircraft Industries L410 Technoavia Rysachok
Turboprops … lowest
cost, best performance
Light jets … expand GE
Honda franchise
Mid-size jets …
everything but engines
Large cabin … GE Passport + Flight Efficiency Services and Power
Services … synonymous
with support
Turboprop platforms
H-Series aircraft opportunities* New
500 2,100
Retrofit
* Next 10 years
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GE Aviation 54
Expanding in growing segments
Large business jet Light business jet
GE Honda is a 50/50 JV between GE and Honda Aero, Inc.
HF120: Certified
• 12,000+ engine cycles
• 8,400 + engine test hrs.
Passport: First engine to test
• Engine performance on track
• HF120 share grow to 25% by 2022 …
growth stimulated by new platforms
• Expected $8B market ’13’-’32
• GE at 23%, projected 2022 share 35%
• Increased international deliveries on
demand for larger cabin, longer range
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GE Aviation 55
Engineering excellence
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GE Aviation 56
Engineering … a global community
China ~150 engineers
Poland ~650 engineers
Italy ~425 engineers
Mexico ~1100 engineers
United States ~5650 engineers
India ~690 engineers
UK ~650 engineers
Turkey ~250 engineers
Aviation
GRC
Over 9500 engineers around the globe + 3000 technologists at 5 Global Research Sites
Czech Republic ~70 engineers
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GE Aviation 57
Leading in commercial engine technology
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GE Aviation 58
Fuel Burn improvement
10%
20%
LEAP is a trademark of CFM International, a 50/50 JV between Snecma and GE
787 (GEnx)
A320, 737 (CFM LEAP)
777X (GE9X)
777 (GE90)
737 (CFM56)
A380 (GP7000)
Regionals (CF34)
1980 2000 2020
Our key new product introductions
HF120 is a trademark of GE Honda, a 50/50 JV between GE and Honda Aero Company
LEAP is a trademarks of CFM International, a 50/50 JV between Snecma and GE
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GE Aviation 59
Program ‘14 ‘15 ‘16 ‘17 ‘18 ‘19
GEnx In service
GE Honda HF120
FAR 25 In service
Passport Flight test Cert In service
CFM LEAP
Flight test Cert In service
Engine test
Flight test Cert In service
Heavy Lift helicopter
Flight test Flight test Flight test In service
GE9X Tech develop
Drawing release
Engine test
Flight test Cert In service
Advanced Combat
Tech develop
Tech develop
Drawing release
Engine test
Flight test Cert
Advanced helicopter
Tech develop
Tech develop
Tech develop
Drawing release
Engine test
Flight Test
Tech maturation
Production development
Airbus/ COMAC
Boeing
Boeing
Honda
Bombardier
Sikorsky
Boeing
DoD
DoD
Technology “FastWorks” … Design Iterations From Your Desk
Design Concept Test Prototype
3D Printing
36 Turnaround
W E E K S
2 WEEKS
Before
Now
Metal Casting
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GE Aviation 60
Technology-dedicated lean labs … accelerating innovation
1
11
lab Maturing All Technologies
Individually Focused Labs
Lean Labs
Research
Production
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GE Aviation 61
Avio Aero … broad range of capabilities
Aeroengine technologies – Avio positioning (Qualitative representation of a geared turbofan engine)
Power
Gearbox Compressor
Accessory
Gearbox
Combustion
chamber
High
pressure
turbine
Low
Pressure
Turbine
Fan
• Up to 700 kw power range
• GBX integration with oil system
• World’s largest LPT experience (GE90)
• State of the art turbine efficiency (GEnx)
• Unique design & make capabilities
• Up to 30 MW power range
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GE Aviation 62
The global research advantage
Global Research Europe Munich, Germany
Brazil Technology Center Rio de Janeiro, Brazil
China Technology Center Shanghai, China
India Technology Center Bangalore, India
Global Research Center Niskayuna, NY 3,500
research employees
50,000
GE technologists worldwide
~$5 billion technology spend
Aero-Thermal and Mechanical Systems
Chemistry and Chemical Engineering
Diagnostics and Biomedical Technologies
Electrical Technologies and Systems
Manufacturing and Materials Technology
Software Sciences and Analytics
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GE Aviation 63
Global Software Center San Ramon, CA
GE’s Analytics Advantage
350
Full flight data growth (# of flights)
Engineers working on Aviation Analytics
25 Customers connected to full flight data
2013 2014 2015
15k
3.4M
~10M
2 340 1,500 Data
Volume (Tera Bytes)
SoftWare CoE
Aviation
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GE Aviation 64
Minds & Machines at GE Aviation Asset productivity….example
Issue: Accelerated wear in regions with high air particulates
Approach: Applied analytics to detect engines at risk of early removal (millions of data points used…every engine in the fleet, every flight)
Value: Prevent high cost events and minimize customer maintenance burden
Time on Wing Maintenance, Repair & Overhaul
Reliability Disruptions
Dis
tre
ss
me
tric
Flight Cycles
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GE Aviation 65
Minds & Machines at GE Aviation where physics meets analytics
“Temperature has shifted in particulate environments”
Anomaly Detection Descriptive Analytics
En
gin
e
Te
mp
era
ture
Departures
“We have isolated the operational condition”
Predictive Analytics
“Condition will cause engine removal in xx flights. Recommended operation to extend time on wing is…..”
Prescriptive Analytics
Above limit … on watch
Below limit … continue service
Departures
Operator A Derate, dust
“A subset of the fleet is susceptible to accelerated wear”
Operator B No derate, dust
Part Temperature
Ex
po
sure
Dis
tre
ss M
etr
ic
Engine data + environment + engine
physics = Customer Value
Cruise
Takeoff Climb
Ex
ha
ust
ga
s te
mp
(C) Corrosion
Threshold
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GE Aviation 66
Minds & Machines at GE Aviation Flight Efficiency Services…improving how airlines fly their planes
Average Cost Increase = 150 kg / flight
Average Cost Increase = 2300 kg / hold
Green = Left Red = Right
“Let’s measure and track
safety & fuel procedures”
+ Austin Digital
“Let’s find and implement
fuel saving programs”
+ Fuel and Carbon
“Partner with me to
increase efficiency”
+ Navigation Services
“Let’s implement full
ops efficiency”
+ Fleet Synchronization
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GE Aviation 67
Supply chain
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GE Aviation 68
Supply Chain … a global community Services
Engines New Make
79 facilities
21 countries
31,400 employees
5,000 suppliers
9 joint ventures
Systems New Make
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GE Aviation 69
Supply Chain execution
Capacity & Capability (commercial & military units)
• Restructure high cost sites
• Expand footprint … new plants
'11-'13 Avg '14 '15-'17 Avg
Drive Cost out ($ in millions)
$221
+
++
'14E '15F '20F
4,000 4,100 4,150
70% NPI
NPI
Comm’l
Military
• Increase volume at low cost sites
• Dual source for cost & risk reduction
• Accelerate productivity …
material & conversion
• Vertical integration … make vs. buy
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GE Aviation 70
Vertical integration activity J
oin
t V
en
ture
A
cqu
isit
ion
D
isp
osa
ls
FADEC JV
Low technology
Non-core
2011 – 2013 … 16 deals Technology differentiation & cost control
• Ceramic-matrix composites
• Enabling technologies
• FADEC JV
• Fuel nozzles JV
• Composites
• Advanced castings
Reenergizing make vs. buy
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GE Aviation 71
10+ dispositions
Fuel nozzles … partnering for innovation
Additive tip (Combined fuel and air circuits)
GEnx LEAP Tip 1 component
Braze/weld 6 joints/8
Cost
Weight
Supplier Developed GRC
Supplier Designed GE Aviation
Supplier Intellectual property GE
Supplier Manufacturing Joint venture
Supplier Services Joint venture
Formation of Advanced Atomization Technologies as a Joint Venture between GE and Parker is subject to regulatory approval
20+ components
27 joints/11
25% less
30% lighter
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GE Aviation 72
Unique Additive Manufacturing expertise Italy – Cameri (Novara)
• Established in 2004
• 10 years of R&D/prod. experience
• New plant in 2013 (12,000 sqft + growth potential of 2x)
• Technical Lab (chemical, Laser Scan)
• Gas Atomization for powder production (Q1 2015)
Key technologies
DMLS (Direct Metal Laser sintering) EBM (Electron Beam Melt.)
Deoiler
Liner
Products
Housing Air duct
TiAl Rotor blades Impeller Injection system
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GE Aviation 73
Material …
Building new technology capabilities
Additive manufacturing
World’s highest capacity manufacturer
Ceramic-matrix composites
Product …
Lean labs
Production …
Application science … Scale … Production …
Clyde, NY
* Advanced Atomization Technologies (Parker JV) pending regulatory approval
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GE Aviation 74
Auburn, AL
Asheville, NC Newark, DE
Maintenance, repair & overhaul … footprint for the future
CFM, CFM56, and the CFM logo are trademarks of CFM International, a 50/50 joint company between Snecma and General Electric Company
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GE Aviation 75
OEM
GE Celma
GE Malaysia
GE Strother
GE Wales
GE Caledonian
St. Quentin Brussels Casablanca Queretaro
Network
CFM56
CF6
CF34/CT7
GE90
GEnx
EGAT
9,000 11,300
15,000
'10 1Q'14 '20F
$42 $96
'10 1Q'14 '20F
Engines under CSA
Services backlog
Network imperatives
• Grow low cost sites
• Expand partner capability and
capacity in each region
++
Wrap up
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GE Aviation 76
In summary
Great GE business that invests & delivers
Unprecedented installed base … and growing
Investments in all segments securing product positions
Unprecedented services backlog … and growing
Minds & machines enhancing customer productivity
A commitment to technology leadership
Culture of simple, competitive cost
structure
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GE Aviation 77