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