GE boss gets a close up look at Rutland
By Bruce Edwards
STAFF WRITER | October 03,2013
Albert J. Marro / Staff Photo
General Electric CEO Jeff Immelt, right, talks with Windcrest Road plant employees, including Mark Dennison, left. Gov. Peter Shumlin, center, joined the tour.
Rutland’s twin connection with General Electric Co., helped land the head of the $160-billion-a-year company as guest speaker Wednesday evening.
For an hour with a near-capacity audience at the Paramount Theatre, Jeff Immelt touched on subjects ranging from health care and aviation to the economy and the budget stalemate in Washington.
Immelt’s presence was also met with more than a dozen GE workers from Ford Edward, N.Y., protesting the planned closure of the energy division plant there next year.
Aviation and health care were what brought Immelt to Rutland for the day. The GE Aviation plant has been a presence here for more than 60 years while Rutland Regional Medical Center has been at the forefront of using the latest GE Healthcare diagnostic equipment.
GE and RRMC are also the area’s two largest employers.
Following his prepared remarks, Immelt took a number of pre-screened questions from RRMC President Thomas Huebner and former hospital director Jerry Tarr, who booked Immelt as the guest speaker.
On the budget crisis in Washington, Immelt said he’s more concerned about the upcoming deadline for raising the national debt. “It’s something we can’t allow to happen,” said Immelt, seated on the stage between Huebner and Tarr.
He said if the United States were to default on its bills it would send shock waves through the economy at every level.
Immelt said the economy remains volatile but “is getting a little better every day.” He also cautioned that the 150,000 jobs created each month nationwide are not enough to bring down the unemployment rate.
The Affordable Care Act created health insurance exchanges, which started signing up people Tuesday. The goal is to reduce health care costs and provide care for all Americans.
Immelt said it will likely take two years or more before the verdict is in on health care reform.
“My hope is we can perfect it and refine it,” he said.
In his remarks, Immelt touched on four things that need to happen to reduce health care costs.
“This system will never work unless every person in this room, and everyone around the country, takes more responsibility for their own health care,” he said. “You need prevention, you need people to watch their weight, you need people to lead a healthy lifestyle, you need people to make good choices.”
He said improved quality and delivery of health care will bring down costs, as will payment reform and detecting chronic disease earlier. Immelt said 75 percent of health care dollars are spent fighting chronic disease.
He noted that Gov. Peter Shumlin is moving toward a single-payer system in this state. Immelt drew laughs from the audience when he said he wouldn’t offer an opinion except to say “you can figure it out on your own.”
Immelt was asked what the community can do to keep the GE Aviation plant competitive.
He said good schools and lower health care costs are part of the answer. But he also said GE has to do its part as well. He said when business is as good as it is now, it’s easy to become complacent so it’s important to stay focused on the customer.
Immelt said GE Aviation has a backlog of $100 billion in orders.
He also offered these observations:
With 700,000 jobs unfilled, the United States needs to invest in education. He said China graduates 135,000 engineers every year, far more than the U.S.
Infrastructure investments need to be made in highways, airports and broadband.
Washington has dropped the ball on helping small and medium-size businesses.
One of the keys to GE’s success is its investment in research and development. Even during the financial crisis, GE increased its research and development investment in aviation from $800 million to $1.8 billion
Asked to name his worst day in the 12 years he’s been GE’s chief executive officer, Immelt said it followed the financial crisis of five years ago.
“The worst day was when I had to cut the GE dividend,” he said, adding he felt compelled to err on the side of caution.
He said the best days are those when he gets to visit places like Rutland.
As the evening ended, Immelt did have a few words for the GE workers who could be heard protesting outside the theater.
“I don’t need those guys outside to tell me about the value of GE jobs,” said Immelt, whose father worked for GE for 38 years. “I get it.”
Earlier in the day, Immelt stopped by the GE Aviation plant on Windcrest Road.
He was shown the various steps it takes to make the compressor blades that power many of the world’s commercial jets and military aircraft, including the Boeing 787 Dreamliner.
He was accompanied by Shumlin and plant manager Dan DiBattista.
Wearing a dark suit, striped tie and the required safety glasses, Immelt made a point of asking questions and encouraging workers.
“Nice job guys, thanks,” Immelt told one group.
At another stop, GE apprentices and their advisers were lined up wearing different-colored golf shirts with the GE logo. Photo displays sat atop several large tool chests.
“How are they doing so far?” Immelt asked one of the advisers.
Bonnie Davis, a 28-year veteran, explained one step in the manufacturing process that once took five workers to complete.
Picking up from Davis, Bob Bizzarro explained the new technology that requires only one worker.
Business is good at GE Aviation, a point driven home by the man who inherited the job 12 years ago from legendary CEO Jack Welch.
“We’ve got a lot of business, so you’re going to be busy,” he told the workers.
Coinciding with Immelt’s visit, GE a announced it will invest another $20 million in its Rutland facility next year, bringing the total investment since 2010 to nearly $100 million.
Over the last three years, the GE facilities on Windcrest Road and Columbian Avenue have increased employment from 950 to 1,250 workers. At the same time, the plants have completed $75 million in capital improvements.
GE attributed the growth to a record backlog and rising production rates. GE said its production rates are expected to increase from approximately 3,600 commercial and military engine deliveries in 2013 to 3,900 deliveries in 2014, and 4,100 deliveries in 2015.
Much of the growth in Rutland is driven by rising production rates of the GEnx, the fuel-efficient engine which powers Boeing’s new 787 and 747-8 aircraft. Deliveries of GEnx engines will grow from 200 this year to 300 in 2014
Approximately 80 percent of the Rutland production is commercial with the remaining 20 percent military.