By Mike Boyer
Enquirer staff writer
The jet engine business of GE Transportation is enjoying its best market since before the Sept. 11 terror attacks, the president of the Evendale-based business said Tuesday. In fact, GE Aircraft Engines expects to hire up to 160 engineers in Greater Cincinnati, he said.
"The U.S. economy is probably the big difference. It's as strong as I've ever seen it looking across GE,'' said Dave Calhoun, president of GE Transportation, which includes GEAE and Erie, Pa.-based GE Locomotives.
That bodes well for the aviation industry, which next week holds its biggest gathering of the year at the Farnborough International Air Show outside London.
The event, which draws the biggest players in the aviation industry, is typically when new commercial and military orders are announced. This year should be no exception.
Although the financial crises facing big carriers such as Delta Air Lines and United Airlines are getting a lot of attention, Calhoun said: "(Airline) traffic is up. Airline schedules are up. The fleet is getting flown more so our service business, which is really what pays the bills, is really strong.''
Revenue at GEAE this year is projected to reach $12 billion, up 12 percent from last year, fueled by double-digit increases in GE's engine service business. Aircraft engines will represent about 80 percent of GE Transportation's $15 billion revenue this year.
GEAE, which employs about 6,200 in Greater Cincinnati, is looking to add about 160 engineers this year. The business cut thousands of jobs since the industry downturn began before 9-11.
"We're having a hard time finding enough qualified engineers,'' said Calhoun. "I'm sure we'll be in a hiring mode for the rest of this year.''
Research and development spending is increasing. GEAE has spent about $1 billion annually since 1999 on developing new commercial and military engine technology.
"That spending should increase by $250 million (a year) over the next couple years,'' Calhoun said.
It's being fueled by engine development for programs such as the new GENX engine for Boeing's planned 7E7 commercial jet and the military's Joint Strike Fighter.
Calhoun said the continuing strength of the Chinese economy and the rise of low-cost carriers is also helping the aviation industry rebound.
"Low-cost carriers fly the kinds of airplanes and engines we like,'' he said. That means narrow body twin-engine Boeing 737s and Airbus A320s, where CFM International the GE-Snecma Moteurs partnership, is the leading engine supplier.
'The only thing I worry about is: Can the economy go at this rate, post-election?'' said Calhoun. "I'm optimistic. I think the momentum would be hard to slow down.''
Another uncertainty is the risk of another terrorist attack.
But Calhoun, who was stranded in Seattle with then-new GE chairman Jeff Immelt Sept. 11, says those attacks were the ultimate stress test for the commercial airline industry.
"We survived that,'' he said. "And, if anything, we're more confident the industry can survive these type of actions.''
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