December 17, 2012
GE Aviation Services' new CEO, Paul McElhinney, talks to Aviation Week's Lee Ann Tegtmeier about how GE will have to innovate to ramp up to service 45,900 engines in 2020.
AW&ST: What are the biggest opportunities and challenges that you see for GE Engine Services?
McElhinney: We look at things in three-year increments, and we have three big priorities. The first is developing the next generation of products that will have lower maintenance costs for airlines. The second is looking at our existing offerings and trying to refresh them in terms of competitive, compelling value propositions from a customer's point of view. Solving customers' problems is something you will hear the GE company talk about generally. When you translate that into the aviation space, with 29,000 GE engines and partner engines in the fleet today, by 2020 we plan to have 45,900 engines in the fleet. We're at a point where we need to look at the offerings we have in the marketplace that support the 29,000 engines and ask, 'What do we need to do to ensure that when that number is 45,900 engines, we maintain a value proposition around our offerings?' We are looking at our offerings to solve customer problems in a way that is responsive to the growth in the industry and to the changing nature of the products that we're delivering.
The third is data. We do not lack data in the industry. I think what we have is a lack of analytical competency around what to do with the data that turns it into savings for customers, efficiency, productivity, profitability, avoiding schedule disruptions, avoiding unscheduled engine removals and avoiding surprises that are so disruptive to airlines and their passengers.
What is your plan to support that very different fleet?
We're a global company, but I think to be a great global company, you've got to be local. We spend a lot of time on establishing the right company presence around the world so localizing, delegating decision-making and decision authority, and empowering the regions is a big focus of ours. Having customer and online support people in all the right locations is part of that. Making every decision in Cincinnati is not going to make us as competitive as we need to be in a global market. There is a lot that we're looking at in terms of support for our customers in a broader context than we would have historically thought of as an engine business.
Can you give me an example?
Take our fuel and carbon products. My personal goal is that in the next three years, we deliver over $1 billion worth of fuel savings, and that is a fraction of what we could do. That's a product we didn't have three years ago. Three years from now, we will be more mature in the way that we go to market, in the way that we interact with our customers, in the way that we use data for customer efficiency, productivity and profitability. Once we've really established this business, the potential is enormous.
The largest pain point for the airline industry right now is fuel, and I think we have a compelling product with a very, very smart set of resources, which are mainly airline resources. We have deliberately hired experienced airline people from flight operations. We have our own internal group of airline pilots. We have done some acquisitions that add products to the portfolio, which we'll try and build out.