GE is looking to ramp up its operating margin throughout its various manufacturing processes in order to boost operating profit. On the one hand this is a 'no duh' sort of press release. What company isn't trying to make its manufacturing process cheaper so that it can ask the same price and make more profit on each item?But in order to stay on top GE is looking to take its 15% operating profit and boost that a percentage point each year to 18% by 2009. To do that it is focusing on increasing margins in places like its locomotive plants. Right now a train engine takes about a month to build, and GE wants it to take ten days.
Although investors will no doubt applaud this focus on the margin and faster production terms, one hopes that a manufacturer of jet engines that keep our planes aloft does not lose sight of the longer term picture. Some of us will remain happy with GE focusing on quality in some areas rather than increased margins.
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Reader Comments (Page 1 of 1)
7-26-2006 @ 3:58PM
P. OB said...
As a shareholder it appears that the companys plans are on the right track. Much work stll has to be done in order to to increase profits and increase shareholder value.The summer months are traditionally a slow time for the the companies and the stock market, but the right decisions will pay dividends in the long run.
7-27-2006 @ 1:55PM
leonard susser said...
as a long time retired mgr of manufacturing for the GElarge jet engine business, i can assure the blog author that the way to shorten assembly of large complex engines is to first assure that you have perfect quality so that assembly can be done easily without having to deal with defective parts. the next step is to have all the high quality parts needed available when the assembly is scheduled to start
7-27-2006 @ 7:31PM
marcel carrara said...
For GE to make more profit it must get rid of NBC. It is a loser and the salaries are to high.IE Katy Curric, Matt and Al.
8-01-2006 @ 1:37PM
steve holben said...
Dumping NBC is certainly a good idea. Network TV is fast becoming a dinosaur. Another way to increase shareholder value is to stop diluting it with all the options. The stock has been flat for 5 years, and it's time to return value to the owners.