GE to become aviation-focused firm

General Electric's F110-GE-129 engine powers the US Air Force's new F-15EX Eagle II fighter. (General Electric)

General Electric (GE) plans to narrow its portfolio to aircraft engines by spinning off its energy and healthcare businesses, the US conglomerate announced on 9 November.

By dividing GE into three separate publicly traded companies, “each can benefit from greater focus, tailored capital allocation, and strategic flexibility to drive long-term growth and value for customers, investors, and employees”, GE chairman and chief executive officer H Lawrence Culp Jr said.

Each of the three companies will have an “investment-grade balance sheet” and access to capital markets, enabling each to operate and succeed on its own, said GE chief financial officer Carolina Dybeck Happe.

GE intends to spin off GE Healthcare in early 2023. GE Renewable Energy, GE Power, and GE Digital will be combined into one business that will be spun off in early 2024. The remaining aviation-focused company will be called GE.

The breakup will have “no impact at this time” on GE's defence aviation work, a GE spokesperson told Janes .

Based in Evendale, Ohio, near Cincinnati, GE Aviation manufactures and services military and commercial aircraft engines. It employs 40,000 people, generated USD22 billion in revenue in 2020, and has a USD260 billion backlog.

GE's military engines power a wide range of aircraft, including bombers, fighters, helicopters, surveillance planes, and tankers. GE received a USD1.6 billion contract award in October to continue providing F110 engines for the US Air Force's new fleet of Boeing F-15EX Eagle II fighter jets.