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Pension Rights Center
Connecticut Avenue, NW, #206
Washington, D.C. 20036-1722
spotlight: GE meeting puts Erie on national stage (VIDEO)
retirees, investors voice their news, views
Jeffrey R. Immelt, chairman and CEO of General Electric Co.,
hardly seemed surprised by the questions or fazed by the
can't do a job like this if you can't take a punch," he said
Immelt, who opened and closed the meeting with a glowing tribute
to Erie-based GE Transportation, took it on the chin more than a
few times during the two-hour shareholders meeting at the
Bayfront Convention Center.
Someone reminded him he was no Jack Welch, a reference to the
company's former boss, who has been critical of Immelt in recent
beaten up for previously selling goods to Iran, lampooned for
supporting Jesse Jackson's Rainbow Coalition and criticized for
the company's most recent earnings report that saw GE profits
fall 6 percent from the same quarter a year earlier.
mostly, he was beaten up by retirees.
one they came forward during a question-and-answer period that
was more questions than answers.
thanked him for a one-time pension increase that came late in
2007. But most, including a number of local retirees, pressed GE
to contribute to funding their pensions and pressed him to
institute an annual cost-of-living increase.
Flowers, president of the local Retirees Association General
Electric, or R.A.G.E, was among those to take a turn at the
people you see here rolled up their sleeves and did the job,"
Flowers told Immelt. "They deserve an annual increase in their
than 100 pickets outside the convention center, many of them
from out of state, echoed the same theme. Don Glenn, a retiree,
from a GE appliance plant in Louisville, Ky., said he stands
sentry outside GE's annual meeting almost every year.
Quirini, a GE retiree from Schenectady, N.Y., and a veteran
picket herself, offered Wednesday to strike a deal with Immelt,
who called her by name when she stepped to the microphone.
Quirini, who spoke on behalf of a shareholder proposal to
separate the jobs of chairman and CEO, promised Immelt she would
leave him alone if he addressed that issue and gave retirees
their requested COLA.
this can happen, I will not hold another rally," she said. "I am
tired of walking in front of the company."
greeted all of the questions, proposals and comments politely,
but urged many of them to hurry it along, saying, "OK, we get
some things of his own to say and a lot of disappointed
investors to address.
had a tough first quarter of 2008, below last year and our own
expectations," Immelt said. "While our industrial earnings grew
26 percent, our financial services earnings declined by 28
are disappointed that we will not hit our 10 percent earnings
growth goal, particularly after we said we could."
same time, however, Immelt urged investors to look at the bigger
infrastructure grew 17 percent in the quarter. Our global growth
was 22 percent in the quarter," Immelt said. "GE earned more
money than any company in the world, except Exxon Mobile. In a
very tough economy, our first quarter earnings were $4.4
billion. This company is very strong."
shares traded at more than $42 per share when Immelt took over
in 2001, but closed Wednesday at $32.36, up 3 cents.
focus might have been on pensions and corporate performance
Wednesday. But Immelt, who was seated in front of a full-sized
shell of a hybrid locomotive, wasn't going to let anyone forget
they were in Erie.
reminded them when the annual meeting was last held here the
company's share of the global locomotive market was 30 percent.
Today, it's 75 percent.
has built a successful business in your town," he said. "But
there is another reason this business is thriving that you may
want to think about this year. That is globalization. We have
5,100 employees in Erie. The amount of engineers here has
tripled since 2005, while the manufacturing headcount has
increased 10 percent. All this while the U.S. economy has
MARTIN can be reached at (814) 724-6397, 870-1668 or by e-mail.
Erie stacked up
following number of registration forms were returned for the
past four shareholders meetings of the General Electric Co.
Erie, 2008 Greenville, S.C.,
2007 Philadelphia, 2006 Cincinnati, 2005
Source: General Electric Co.
chief talks shop
Q Why did you
choose Erie for this year's meeting?
always like to be in a GE town. We rotate it every year and it
has been since the 1990s since we had been in Erie. We like the
team, we like the town. It's been good to us and we just thought
this would be a nice place to come this year.
Q What has the
always get a mixture of people, here in this town in particular.
We have so many retirees who will be here today. They like the
company and they are proud of the business. And you have people
who are pensioners who are here. They want pension increases and
things. You have special interest groups here. They will want
changes in governance. You have investors here, and they will
want the stock price to go up. Everybody represented will be in
a room. It's corporate democracy at work and that's the way it
understand this was a business you wanted to highlight. At a
time that companies are outsourcing and moving business offshore
-- GE included -- this unionized business in Erie is doing well.
really is, because we have invested in technology. And have
aggressively sold our product in every corner of the world. The
union and management have worked very well together to work on
lean manufacturing and things like that. ... But by all rights,
this 100-year-old business and this 100-year-old factory
shouldn't be here anymore. Yet the combination of good
technology and globalization has really helped us.
Q How do you
feel about the future of this business. Is it ever going to go
think the fundamentals are very robust. In many ways, this
business benefits from globalization. Globalization, although it
scares people, is a big reason why the locomotive business is
going to be very strong.
Q So in your
mind, globalization doesn't mean we can't build these things in
at all. Look, I don't run a charity. I run a very competitive
global enterprise. The fact of the matter is this plant and this
location makes the highest quality, lowest cost locomotives in
the world. That is a good thing. We have worked our ass off to
make that happen. It doesn't happen by accident.
Q John Rice,
Charlene Begley and a lot of other top GE managers have come out
of Erie. This has been called a breeding ground for GE
management. Is that part of a philosophy or is it happenstance?
think a little of both. A leader can cut their teeth and get a
little bit of union, a little bit of global and a little bit of
technology, all in the context of a business where we have a
very strong competitive position.
don't want (Erie) to be known for just that (being a training
ground). I think it's important that leaders come and stay here
so they can change the place strategically. That takes time.
Q Do you think
Wall Street as a whole and some analysts overreacted a bit to
your most recent earnings report or was this a wakeup call?
There will be disappointment anytime you miss your estimates. In
many ways, we deserve what we got.
think it's time to take a step back and say we earned more money
than anybody in the world last year except Exxon. We earned $4.5
billion in the last quarter, our revenues were up 22 percent.
This company has a lot of strength. I am going to fix what
happened. I don't accept it and I think investors have every
right to be disappointed in us. By the same token, we are going
to stay the course strategically. I think we have the right team
and the right strategy.
Q Any plans to
go hunting with Jack Welch (the former CEO who commented
recently that if he had a gun he would shoot Immelt)?
Q Some believe
GE is too big. Would you consider selling NBC or other GE
always tell people to name one company in the last five or six
years that has disposed of $50 or $60 billion worth of business.
We have been very aggressive job from a portfolio standpoint.
... We are going to continue to do that.
pretty tough-minded about the business. Nothing is forever, but
right now I don't see anybody that can run NBC any better than
we can run it. It generates a lot of cash for the company and
gets good returns. I think we stay for right now.