KUALA LUMPUR: US-based General Electric (GE), the world's second largest company by market value, is targeting revenue from its Malaysian operations to breach the US$1bil mark by 2010.
GE International Inc South-East Asia president Stuart L. Dean said the projection was based on annual revenue growth of around 10% over the next three years from existing businesses ranging from infrastructure and power generation to lighting and healthcare.
He said GE was on track to double its revenue over the period if it could introduce its consumer finance business to the local market soon.
“Assuming we are in time to get in the local consumer finance business, I think we will be able to achieve this target,” he told StarBiz in an interview.
Dean said GE was serious about its foray into the local consumer finance market and was currently looking for the right partner.
“We are committed to make our entry in a form of a joint venture. There are a lot of business development activities going on but I can't predict the exact time for us to come in,” he said.
He said consumer finance would form a major portion of GE's future investments in Malaysia that would include expenditure for upgrading the capacity of its aircraft engines manufacturing and one of its advanced materials facilities, in the short run.
“Once we have a larger financial service unit, we have big plans including putting up a regional backroom that serves not only the Malaysian market but also other regional markets,” he said.
GE, which started its operations in Malaysia in 1975 trading refrigerators, expanded gradually into power generation plants supply, aircraft engines, repair and overhaul, power generation, oil and gas, locomotive and water supply, serving Malaysia Airlines (MAS), AirAsia Bhd, Petroleum Nasional Bhd (Petronas) and KTM Bhd.
GE has to date invested over RM1bil in Malaysia and employs 1,200, mainly locals, at the Malaysian unit, which is also the headquarters for GE operations in Asean.
It currently has three manufacturing plants in Malaysia – LNP Engineering Plastic in Senawang, which produces thermoplastics composites; GE Plastics Malaysia in Klang, which manufactures specialty sheet and film; and GE Malaysia Appliance Components in Kota Tinggi.
“We also have an engine overhaul shop in Subang called GE Engine Services Malaysia (GEESM) which is a joint venture between GE, MAS and AirAsia,” Dean said, adding that GE serviced more than 30 airlines in Asia.
GE is also a key supplier of advanced healthcare products like x-ray, ultrasound, and cancer scanning facilities to various local hospitals. Its most recent accomplishment was the supply of the positron emission tomography cancer scanning facility – one of the world's most advanced cancer scanners – to Putrajaya Hospital.
Dean said GE expected revenue of US$450mil this year and US$500mil next year, mainly from supply and service contracts.
“The main driver of revenue growth for us will be Tenaga Nasional Bhd's power generation projects and Petronas service contracts, alongside other projects involving electronics components.
In another development GE, together with Star Publications (M) Bhd, DBS Bank Ltd and OCBC Bank (M) Bhd, are sponsoring a regional conference themed Malaysia-Singapore Businesses, Expanding in Asia: New Challenges and Opportunities in Kuala Lumpur on Nov 27.
Organised by the London Business School Alumni Club Malaysia, the conference is aimed at, among other things, enhancing the relationship between opinion and business leaders in both countries as well as offering business leaders an insight to current global management issues.
Dean, who will be speaking at the conference, said: “We decided to sponsor the conference as we felt we had a good story to tell by showcasing how GEESM in Malaysia works with GE Aviation Service Operations in Singapore.
“It highlights how Malaysian and Singaporean businessmen can partner strategically and successfully capitalise on their synergies to support the expansion efforts in the region.”
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