GE dismantles its corporate fleet of business jets
General Electric, the US conglomerate with a market cap of $206 billion, is getting rid of its corporate fleet of business jets to cut costs. This follows John Flannery replacing Jeff Immelt as CEO of GE two and a half months ago.
GE's fleet is currently made up of 6 private planes. The publicly-traded company owns three Challenger 600s, two Global 500s, which were built by Bombardier a Honda light jet. This lineup is further completed by an equity share in at least another five aircraft, three Gulfstreams owned by NetJets, an Embraer Phenom 300 and a Cessna Citation according to the FAA.
According to data gathered by Bloomberg, top managers at GE spent $1,4 million on person trips combined in the past 3 years across the company's fleet. "We are reducing the Corporate Air Transport services and will use charter companies as needed." commented a spokeswoman for the company.
The move follows former General Electric CEO, Jeff Immelt sparking a controversy by having a second private jet follow the one he was on in case of mechanical failures. The company however explained this was used only for critical business matters and the practice was ended in 2014.
"A lot of our sites are not easily accessible by commercial aviation" said Brad Mottier GE's Aviation VP, "To get to some you need to take multiple flights and sometimes then drive for a couple of hours to get there, so the HondaJet flying direct is a huge productivity gain."
Ironically, HondaJet had just released a video commercial showcasing how GE uses its aircraft for productivity gains, several days prior to the announcement. Amongst the benefits highlighted by the executives are the jet's wireless connectivity options and comfort.
An executive from GE's financial department even outlines how operating its own business jet is more efficient for GE as it uses it for over 300 hours every 3 months. This move to sell off the corporate fleet however comes in midst of a global cost cutting phase at GE that hopes to saves $2 billion by the end of the year.