GE 2013 Annual Report



Entire Annual Report - PDF/5.1MB Independent Auditors Report - PDF/184KB Glossary - PDF/104KB
Entire Narrative Section - PDF/3.3MB Management's Discussion and Analysis - PDF/511KB Corporate Information - PDF/92KB
Letter to Shareowners - PDF/759KB Management's Discussion on Financial Responsibility - PDF/127KB 2013 Form 10-K - PDF/1.4MB
Business Overview - PDF/2.6MB Audited Financial Statements - PDF/136KB 2014 Proxy Statement PDF - PDF/14MB
Board of Directors - PDF/177KB Notes to Consolidated Financial Statements - PDF/753KB 2014 Proxy Statement Supplemental Details PDF PDF/88KB
Entire Financial Section - PDF/1.2MB Supplemental Information - PDF/165KB

Learn how GE has stayed competitive
for more than a century

Scale of Infrastructure Leader
Leading in Productivity
The Look of a Simpler Company
A Competitive Team

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We define progress as the ability to better compete, innovate and perform.

Powering Algeria’s Job Growth

Engines on a Mission

Leading from the Middle

A Solution in the wind for Mongolia

On Track for Growth in Kazakhstan

Lighting the Way to Safety and Savings

Teaming up to Tackle Brain Injuries

Building Opportunities in Nigeria

Industrial Internet Powering Locomotive Performance

Reinventing Imaging for Better Patient Care

Reenergizing Energy Sources

High-Flying Intelligence

Remote Service for Africa

Cleaner Power for China

Centricity 360TM

Connecting Homes in a WINK

Local Solutions, Global Health Benefits

Simplicity through Sharing

Increasing Customer Intensity

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Scale of an

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GE builds, moves, powers and cures the world. We are the global leader in infrastructure, developing and changing markets. For example, GE Aviation's portfolio of engine technologies is helping improve air travel for customers in the Middle East. At the 2013 Dubai Air Show, GE and its partners, CFM International (GE and Safran) and the Engine Alliance (GE and Pratt & Whitney), won more than $40 billion (list price) in commitments for advanced, fuel-efficient jet engines. We lead in infrastructure because our products are essential to our customers' operations—and to the economic vitality of every country and region in which we operate.

PICTURED: Engine Alliance engine, a joint venture between GE and Pratt & Whitney

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Leading in Productivity

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Productivity drives wealth creation for the world. Just a 1% change in energy consumption and capital expenditures can create billions of dollars of savings across industries. At GE, we win with innovations that are focused on productivity. We're creating efficiencies for our customers and for our Company with the power of the Industrial Internet, with advanced manufacturing techniques, and by taking a leadership position in the age of natural gas.

PICTURED: GE launched the first "brilliant" wind turbine in 2013. Using the Industrial Internet to analyze data, it can talk to service technicians and even to other wind turbines.

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The Look of a Simpler Company

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At GE, we think simpler is better. Simplification means quicker execution and closer collaboration with customers. It’s a focus on efficiency, speed and market impact. With fewer layers and more field empowerment, we’re putting accountability where it matters. We’re bringing new ideas to market at a faster pace. And we are increasing customer intensity throughout the Company, so that all of us – from commercial teams to enabling functions – are aligned with market success.

PICTURED: Ionel Barbut and Alessandro Lonoce, Avio Aero, a GE Aviation business

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What is Progress?

What defines progress? For GE, it means improving the way the world works. We do this by leading in infrastructure; by combining industrial capabilities with analytical smarts to launch products that optimize efficiencies; and by simplifying processes, enabling us to more quickly respond to market shifts and to collaborate more closely. We define progress as the ability to better compete, innovate and perform. At GE, we are successful—not because we are perfect-but because we make progress. This is a commitment we make to our customers, employees, shareholders and the world.
“We want to be a company that is always getting better. A company that understands where it fits in the markets and in society and appreciates its responsibility to both.”
- Jeffrey R. Immelt

PICTURED AT RIGHT: Maria Cioce and Marco Cipriani, Avio Aero, a GE Aviation business

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A Competitive Team

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Our culture is about providing everyone who works at GE with opportunities to exercise their responsibility, integrity and creativity while growing themselves, their careers and our business.

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The GE Healthcare Ultrasound teamhas created a leadership position in a fast-paced, global business, with innovative products to help solve health issues around the world.

GE Teamslike our Distributed Power team working on a new diesel engine, are using the FastWorks process to improve speed and competitiveness.

The Capital Planning teamensures GE Capital is safe and secure, overseeing regulatory and economic capital efforts, running stress tests and managing recovery and resolution efforts.

Around the Worldand in the U.S., our manufacturing teams tackle big projects, like the subsea blowout preventers built by our Deepwater Assembly teams in Houston, Texas.

  • MOVE

    On Track for Growth in Kazakhstan

    GE is a strategic partner for Kazakhstan, where rail transportation is crucial to the country’s economic development. Working with the state-owned railroad company, Kazakhstan Temir Zholy (KTZ), we helped it build an assembly plant in Astana, Kazakhstan, that is now delivering state-of-the-art Evolution Series locomotives while also creating local job opportunities. Under a long-term service agreement, we are also maintaining 695 GE locomotives and training GE and KTZ employees to ensure that local personnel have the technical expertise to keep the rail system on the right track.


    Powering Algeria’s Job Growth

    To meet a growing demand for energy, Algeria is turning to GE technology and solutions. SPE, an affiliate of Sonelgaz, the national power company for this North African country of over 38 million people, signed contracts in 2013 to deploy GE gas turbine technology at nine power plants. The project will add nearly 9 gigawatts of electricity to help Algeria satisfy power needs that have been growing by 14% per year. In addition, GE and Sonelgaz are partnering on a multi-year joint venture to build a facility to produce power generation equipment locally, eventually producing more than 2 gigawatts of power generation equipment per year and creating, in due course, nearly 1,000 direct and indirect jobs.


    Leading from the Middle

    Middle-market companies are engines of economic opportunity, and GE Capital is dedicated to helping them grow. Our annual Middle-Market Summits, co-sponsored with The Ohio State University, have enabled thousands of midsize customers to interact with top executives and academics to explore new ways to build their businesses. And through Access GE and other programs, we’re connecting these customers with valuable industrial technology. In 2013, we helped Aavid Thermalloy, a leader in thermal technologies, and a portfolio company of Audax Group, a GE Capital customer, create new products by licensing our patented Dual Cool Jet (DCJ) technology. Developed by GE scientists at our Global Research Center, DCJ gives Aavid the ability to help its customers keep their electronic products cool and to reduce their size.

    PICTURED: GE’s Rod Bollins, Greg Gratson and Peter deBock and Aavid’s Norm Soucy and Julie Hitchcock

    For More on GE’s Middle-Market Summits, Watch this Video
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    Teaming up to Tackle Brain Injuries

    Every 20 seconds, someone in the United States suffers a brain injury. The Head Health Initiative is a partnership between GE and the NFL to develop better technologies for the diagnosis and treatment of these injuries. Guided by top neurosurgeons and other experts, the initiative includes a four-year, $40 million R&D program to develop imaging technologies that can improve diagnosis and help doctors provide more targeted therapies. The NFL, GE and Under Armour also launched two open innovation challenges that will provide up to $20 million for research and technology to better understand, diagnose and protect against mild traumatic brain injury.

    Photo: AP


    Building Opportunities in Nigeria

    In Nigeria, an infrastructure investment by GE is helping to turn the coastal city of Calabar into a manufacturing hub for products serving all of West Africa. We have committed to invest a total of $1 billion in Nigeria, most recently investing in a manufacturing and assembly plant in Calabar that will produce and service a wide range of products for power generation, and oil and gas exploration. Establishing operations in Calabar will enable GE to develop a skilled local labor force, with the expectation of creating 300 jobs at the facility and another 2,000 indirect positions with suppliers.


    Lighting the Way to Safety and Savings

    Glaring midday sun in Bauru, Brazil, made incandescent traffic lights hard to see. High-pressure sodium lights in posts along the bridges in Florianapolis, Brazil, were unattractive and costly. By switching to GE LED traffic lights, Bauru has reduced the number of accidents that occur from 11:30 a.m. to 2 p.m. and is on its way to saving more than $2 million over the next 10 years. The Colombo Sales Campos and Pedro Ivo bridges also are now safer and more beautiful, thanks to more than 200 GE LED fixtures placed in specially designed posts, with energy savings of more than 50%.

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    Engines on a Mission

    The airplanes served by GE Aviation’s Business & General Aviation group do everything from delivering medicine and serving remote locations not covered by commercialized airline service to supporting agriculture and enhancing business productivity. For example, the H80 engines on Aircraft Industries’ L 410 aircraft are helping improve lives through humanitarian operations in Africa. In Nepal, these engines provide access to markets for people in hard-to-reach, hazard-filled regions. And with excellent performance and economics, the H80 Turboprop engine on the Thrush 510G agricultural aircraft is reaching new markets like China and helping to feed the world.

    For More on How the H80 Engine is Making a Difference, Watch this Video

    A Solution in the Wind for Mongolia

    With one of the world’s fastest-growing economies, Mongolia expects to see its power demand double by 2025. But its reliance on coal has made its air quality the second worst in the world. In response, its government has pledged to generate as much as 25% of its electricity from renewable resources by the end of the decade. It took a major step forward this summer when it opened the country’s first wind farm. Powered by 31 GE 1.6 megawatt wind turbines, the new Salkhit facility could provide as much as 5% of Mongolia’s electricity.


    Providing Power and Water to the Typhoon-Stricken Philippines

    When Typhoon Haiyan struck the Philippines in November 2013, Bogo City on Cebu Island took a direct hit. But one of our 1MW Jenbacher JGC 320 gas engines weathered the storm and, through the heroic efforts of local operators, became the community’s primary source of electricity. The JGC 320 was critical to the recovery effort, powering hospitals and evacuation centers, and was even used to charge the phones of local citizens. In addition, GE engineers provided the typhoon-stricken area with 60 innovative, portable water-purification devices, which can use saltwater and electricity from either a car battery or a solar panel to purify water. Together, the 60 portable water-treatment units produced enough drinking water for 600,000 people.

    For More on How GE Brought Electricity back to the Philippines, Watch this Video

    Reenergizing Energy Sources

    Dubai Aluminium (DUBAL) was the first GE customer to adopt our Advanced Gas Path (AGP) technology for its installed 9E gas turbines, powering one of the world’s largest aluminum smelters. AGP, part of our Power LifeMax™ portfolio of hardware and software blended solutions, was engineered based on our analysis of over 100 million hours of gas turbine operating data. It can deliver industry-leading upgrade performance, reduce fuel consumption and extend the life of turbine assets. The result for DUBAL was 3.4% higher output and a 1.5% increase in fuel efficiency, which helped expand production and reduce costs.

    For More on Dubal and GE’s LifeMax Portfolio, Watch this Video

    Industrial Internet Powering Locomotive Performance

    GE’s RailConnect 360 Monitoring and Diagnostics (M&D) solution helps rail freight operators transport essential goods more reliably and cost-effectively. It’s one of the first applications of the Predix software platform developed by our Software Center in San Ramon, California, designed to connect hard assets like trains to the Industrial Internet. By analyzing performance data, the RailConnect 360 M&D system enables proactive repairs and more informed routing decisions for customers like Vale, a global mining company headquartered in Brazil. The system has helped maximize Vale’s locomotive productivity, reducing shop cycle time and increasing line availability.


    Reinventing Imaging for Better Patient Care

    New healthcare challenges—such as demands for greater access to care, reduced reimbursements, and regulatory changes—require new thinking. GE Healthcare is collaborating with UPMC, an $11 billion global health enterprise with 22 hospitals and 3,500 physicians serving nearly 2.3 million plan members, to use innovative science, technology and medicine to invent new models of accountable, cost-efficient, patient-centered care. Teams from UPMC and GE, working together at UPMC’s Technology Development Center in Pittsburgh, will reimagine imaging workflow using cloud-enabled technology to improve the way providers archive, access and interpret MRIs, CT scans and other imaging modalities.

    Photo courtesy of UPMC


    Better Engineers Born from Innovative Manufacturing

    GE’s investments in our Rutland, Vermont, Aviation plant have created manufacturing capabilities as advanced as our engines. The Rutland team partnered with GE’s Global Research Center on specialized tools to shape advanced materials, such as titanium aluminide. Advanced manufacturing is improving our financial performance: A $75 million investment in Rutland’s expansion led to more than $300 million in engine production savings.

    PICTURED: Bruce VanGuilder, GE Aviation


    Cleaner Power for China

    As China faces the need to diversify its energy sources, GE is helping the country turn to natural gas for power generation. In the Huadian Industrial Park in Beijing, we recently installed two Jenbacher natural gas engines to power China Huadian Engineering Co. The engines reduce the company’s reliance on coal for power generation while increasing reliability through distributed power. Natural gas use for power generation in China is projected to increase threefold by 2025.

    PICTURED: Wang Jin, China Huadian Engineering Co.


    High-Flying Intelligence

    Collecting and analyzing aircraft data, GE Aviation helps airlines become more efficient. Flight Efficiency Services use smart software and analytics algorithms to enable customers such as GOL and Air Asia to achieve higher efficiency in fuel management, flight analytics and navigation services. Intelligent Operations Service, developed and provided by Taleris, a joint venture between GE and Accenture, is now being used to analyze data from equipment and systems to help predict and prevent maintenance issues for Etihad Airways and other customers. An average domestic airline using Intelligent Operations could avoid 1,000 delayed departures or flight cancellations per year. When disruptions do occur, Taleris enables customers such as Southwest Airlines to recover schedules quickly and efficiently.


    Connecting Doctors and Nurses to Create Better Patient Outcomes

    When healthcare providers can connect with one another quickly and securely, workflow improves, and the result is better patient care. Centricity 360™ from GE Predictivity employs a secure, cloud-based platform to help teams of physicians simultaneously access images and reports, and collaborate on diagnosis and treatment plans. Building on the Industrial Internet expertise of our Software Center, Centricity 360 has the potential to reduce duplicate tests and patient transfers, while helping hospitals manage imaging costs and system maintenance.

    For More on Centricity 360, Watch this Video

    Remote Service for Africa

    Durban, South Africa, is 600 kilometers from Johannesburg and also the location of the nearest qualified power generation service engineer. But diagnosing and fixing a problem at the power plant operated by Durban’s eThekwini Municipality required just a phone call. Since 2007, the Bisasar Road power plant has relied on GE Jenbacher gas engines to convert landfill methane gas into a critical source of power for Durban’s 3.1 million inhabitants. Through GE’s 24/7 remote service hotline, an agent in Jenbach, Austria, diagnosed the problem, related to a backup battery, and uploaded new parameters. The plant was up and running in just 90 minutes.


    Tapping the Industrial Internet for Clean Energy

    The QGC Queensland Curtis liquefied natural gas (LNG) plant in Australia will be the world’s first facility to turn coal seam gas into LNG, a cleaner fuel that can cut global greenhouse gas emissions more than 35% when substituted for coal. To improve plant performance, QGC turned to GE Oil & Gas and the power of the Industrial Internet. GE teams in Houston, Florence and Kuala Lumpur remotely track and advise on the performance of the plant’s equipment, including 15 GE aeroderivative gas turbines and 28 centrifugal compressors. As a result, GE is partnering with QGC to deliver a guaranteed uptime throughout the life of the 22-year contract.


    Dynamic Tools for Fast Growth

    What happens when we combine a Silicon Valley startup mindset with Lean Six Sigma? The answer is FastWorks—a set of tools and processes to develop new products quickly, achieve better outcomes for our customers, and drive quality and competitive advantage. FastWorks was behind our co-creation with Chevron and Los Alamos National Laboratory of a new solution for flow metering in multiphase oil wells. In less than a year, we went from a problem statement to prototypes, and we now have an alliance with Chevron to commercialize the resulting product. Known as the GE Safire™ flow meter, it will extend the benefits of better reservoir management to the entire oil and gas industry.


    Unleashing Opportunities for Saudi Women

    In support of Saudi initiatives to reduce unemployment and increase the Kingdom’s own labor force, GE is joining with Saudi Aramco and Tata Consultancy Services to open Saudi Arabia’s first all-female business-process services and training center in Riyadh. Saudi women employed at the center will initially help Saudi Aramco and GE manage their supply chains, but the facility will expand to support other clients. The ultimate goal is to recruit and train up to 3,000 women, including 1,000 to manage GE business.


    Increasing Customer Intensity

    Putting customers first is key to our strategy, and our sales team works tirelessly to deliver for our customers every day. As part of simplification, we are rallying the rest of our employees around the sales team to help our customers win. GE’s 2013 Customer Day kicked off this effort; everyone took the time to get to know and better understand our customers and their issues. Customers joined employees at more than 40 GE locations to share their views on what’s working and where we can improve. New ideas emerged and our teams made specific commitments to support our sales team. Around the world, employees were energized by a deeper customer focus.


    Connecting Homes in a WINK

    Simplification is using the collective mind of the crowd to innovate products. In 2013 GE opened thousands of patents to Quirky’s community of inventors to drive the co-development of new smart home products. After just a few months of partnership, the result was a line of products connected to the internet via the WINK app platform. Products like Nimbus, a dashboard that tracks emails, tweets and online traffic; and Spotter, a versatile home sensor that monitors anything from crying babies to motion and temperature. GE and Quirky will launch 30 home products over the next five years—driving faster innovation and scale in the estimated $25 billion connected devices market.


    Local Solutions, Global Health Benefits

    Empowering faster decision-making at the local level has global impact. Consider our Vscan lightweight, pocket-sized ultrasound device, for example. Vscan was developed to provide better care in remote communities that lack access to conventional medical imaging technology. GE Healthcare originally created Vscan for use in China, and has since rolled out the system in more than 100 countries. Our commitment to invest in breakthrough ideas at the local level, and to expand their use to improve health around the world, has helped grow our ultrasound business from #7 in the world a few years ago to #1 today.


    Simplicity through Sharing

    Across GE, we’re simplifying the way we work—so we can better serve customers and seize opportunities. For example, we’re creating centralized locations from which teams can provide enabling function support for all of our businesses. Our first centers opened in Shanghai and Mexico in 2013, and additional centers will be located in the U.S., Hungary and Saudi Arabia. We’re also creating uniform Enterprise Standards to streamline processes company-wide. This effort springs from a simple fact: Simplifying processes will improve cost, quality, speed and competitiveness, while also driving world-class results.

    PICTURED: Josephine Wang, Accounting Operations, Global Operations Finance; Jennifer Shao, Buy To Pay, Global Operations Finance; Ming Tu, GGO China, CFO


Letter to shareowners

Close Video

Making Progress

GE has stayed competitive for more than a century—not because we are perfect—but because we make progress. Progress is about getting better, being better, doing better; this is why GE people get up every day. We are mission-based. GE technology and people move, power, build and cure the world. As investors, you can expect us to listen, learn, adapt and change. You should expect us to get better every day, to make progress.



Senior Vice President and Chief Information Officer


Vice Chairman, GE


Senior Vice President and General Counsel


Senior Vice President and Chief Technology Officer


Senior Vice President, Human Resources


Chairman of the Board and Chief Executive Officer


Vice Chairman, Enterprise Risk and Operations


Senior Vice President and Chief Financial Officer


Vice Chairman, GE and Chairman and Chief Executive Officer, GE Capital


Senior Vice President and Chief Marketing Officer

  • NOT PICTURED: John L. Flannery, Senior Vice President, Business Development

GE builds, moves, powers and cures the world. We are the global leader in infrastructure, developing and changing markets.

The difficult part about progress is that great results take time. But, the pay-back can be huge. Last November, we received $40 billion of engine wins at the Dubai Air Show—in two days. These commitments were for revolutionary new products that have come to market in the past few years. They are based on big bet technologies, years in the making and delivered ahead of the competition.

Leading these results was the GE9X, which is the sole-source engine for the Boeing 777X. This plane is 20% more fuel efficient than the one it replaced, saving airlines $11 million per airplane per year. The GE engine drives 50% of this improvement based on innovative new technology in compressors and combustors. This new engine—the largest and most fuel efficient in the world—has only 16 fan blades, down from 22 in its predecessor. This achieves efficiency and reliability for our customers. And, to further performance, it is based on a GE invention: a new material called ceramic matrix composite. This material retains its strength at 2200° F — 500° F higher than metal-at one-third the weight.

As China faces the need to diversify its energy sources, GE is helping the country turn to natural gas for power generation.
PICTURED: Wang Jin, China Huadian Engineering Co.

Our wins in Dubai came primarily from three customers: Emirates, Etihad and Qatar Airways. None of us grew up at GE with them as customers. Each has emerged as a global leader in the past decade. And, we have built an excellent relationship with them based on solid operational performance and mutual trust. The combination of superior technology and strong relationships is the essence of competitiveness and allowed GE to win virtually all of the commitments at the show.


Winning takes bold commitments, a dedicated team and resilience. There were at least two "moments of truth" as we invested in our new engine line-up. After the 9/11 tragedy, the commercial aviation industry was in full crisis. Instead of panicking, we increased our investment in the business and our customers. This has created trust and loyalty for GE that is unmatched. In 2008, during the depth of the financial crisis, we substantially increased our investment in commercial engine R&D. Because we made the right bets, we have the best products at the right time, securing decades of leadership for your Company. The desire to compete and win runs deep across the Company.

GE's ability to innovate is particularly crucial in the slow-growth and volatile economy we live in today. Frequently I tell investors that if we ever see a U.S. economy like the ones we had in the '90s, GE will have earnings upside. While we don't expect that soon, there are signs that the U.S. economy is getting a little better each day.

Meanwhile, Europe has stabilized; while its expansion is anemic, the "daily crises" have been eliminated. And, there are pockets in the region that are robust for GE like Germany, the Nordic region and Central Europe.

We still see opportunities in emerging markets. China is one important engine of growth. China has massive financial strength, and we see its reform efforts as a positive. GE has a major role in helping China solve its healthcare, clean energy and transportation challenges. In the resource-rich countries, our prospects are bright despite a more volatile macro-situation. GE provides the capability for these countries to industrialize through our technology and localization efforts. That is why our growth is accelerating in regions like the Middle East, Russia and Africa despite social and political unrest.

The world is complicated. But, through the fog of the last five years, I would take the 2014 economy any day. The recovery is slow, but there are no major headwinds. While governments are not addressing major challenges like immigration and regulatory reform, there is less disruption. And, we have the financial strength to make progress on our own.

We are positive about the future. We have positioned GE to capitalize on the growth themes of the era. We are investing to lead in the new technologies that will drive efficiency for the Company and our customers. We are improving our speed and lowering our cost. We plan to deliver a valuable financial performance. We are making progress.

PICTURED: Jacob Wood, GE Power & Water

We Are the World’s
Most Competitive Infrastructure Company


Investment in infrastructure is expected to reach $60 trillion by 2030. Success requires technology, services and execution delivered at scale across a massive global footprint. With more than $100 billion in revenue and nearly 16% margins, we are the largest and most profitable infrastructure company in the world. Our goal is for infrastructure earnings to be 70% of GE's total.

Infrastructure is essential. Countries must invest in infrastructure to compete and create jobs. For instance, Africa has a 100 gigawatt deficit in electricity. Only by investing in power generation can it sustain growth. Fortunately, Africa is surrounded by some of the world's largest reserves of oil and gas. Converting "gas to power" is its infrastructure challenge. Only GE can provide complete solutions to solve its electricity problem. In Africa, we are a productivity partner. As a result, we are growing 30% annually there.

GE has a unique advantage because of our depth and breadth. Customers value our technical depth. Our products are the heart of our customers' operations. GE's high-performance locomotive improves profitability and safety at a railroad. And, our unique breadth makes GE a desirable partner. In Russia, we are investing across five business segments. We are building local capability to deliver local solutions. GE is one of the largest multinationals in the country.


Saudi women at the Riyadh-based process services center will initially help Saudi Aramco and GE manage their supply chains, but the facility will eventually expand to support other clients.

We have a set of enterprise initiatives that capitalize on our scale and ability to spread ideas horizontally across GE. These initiatives are customized for infrastructure and allow us to lead in both share and margins. We invest more than $10 billion each year to reinforce this leadership.

GE wins with technology. We invest 5%-6% of revenue back into new products every year. Technology creates competitive advantage and margins. We spread ideas through our Global Research Center with six locations around the world. Our products must be both innovative and economical. I ran our Healthcare business in the late '90s, and we sold three types of MR scanners; today we sell many more with differentiated customer benefits. We know how to deliver the best technology at every price point with high margins.

GE wins in growth markets. We know how to be both global and local. Most countries want the same things-competitive capabilities that create jobs, sense of pride and progress that lifts all people up. They want to tap into the global marketplace for progress, ideas, and the capability to export their goods. GE is an excellent partner as countries grow. For instance, we opened a new business-process center in Saudi Arabia that will employ thousands of local women. This is good for GE, while making us an integral part of the Kingdom's economy. Last year, growth market orders passed $40 billion and grew by 11%. Our revenues exceed $1 billion in 24 countries.


GE wins by delivering customer productivity. We understand the domain in which our customers operate. Our customers want outcomes: more power, better fuel burn, no unplanned downtime. We deliver these outcomes. For instance, we have an innovation for our power generation customers, called the Advanced Gas Path. This is a control and software upgrade to our installed base. Implementing this technology will extend our customers' operating parameters, delivering a 30% reduction in downtime and saving fuel. We have a service backlog of $180 billion, aligned with achieving customer productivity.

We can leverage our enterprise advantages as we win in new infrastructure markets, like Oil & Gas. We have grown this business from a "standing start" to nearly $20 billion in 15 years. We invest on the premise that the oil and gas industry will require the same technical intensity and execution as Aviation, where GE leads. We can draw on the "GE store"-gas turbine technology, aviation materials, healthcare imaging, global capability—to solve customer problems. To win in Oil & Gas, we have increased our R&D, built research centers in Oklahoma City and Brazil, and launched innovative solutions in areas like advanced subsea systems and enhanced oil recovery. We are investing in new manufacturing capacity in Angola, Indonesia, Brazil and Russia. Through our service offerings, we give our customers resilient systems that improve their output. Our ability to turn enterprise capabilities into profitable growth is valuable to investors.


The balance of our portfolio is a valuable specialty finance franchise, which we have decided to make smaller. We settled the remaining liabilities of our former Japanese consumer finance business. This business had been a financial drag on the Company, and our exit is a positive for investors. And, we announced a planned split-off of our Retail Finance business in a capital-efficient process beginning in 2014. We have a solid franchise in the private label credit card business, but it is a step removed from GE Capital's strength of lending to industrial middle-market companies. By 2015, we expect financial services should be 30% of our earnings.

GE Capital is a valuable middle-market franchise that builds on GE strengths and our domain expertise. We have strong leadership franchises in areas like equipment and inventory finance, and a portion of our assets are around GE's installed base. This gives us unique capability in aviation, energy and healthcare. We link our Capital customers to GE through a program called "Access GE," through which we share our best practices to help them run their businesses better. GE Capital has never been stronger or safer, and we are making substantial investments to meet the standards expected from a Federal Reserve regulated financial institution.

GE's portfolio sets our potential. We have completed substantial work over the past decade. We have repositioned GE Capital as a smaller and safer specialty finance leader with less leverage and more liquidity. We have redeployed capital from businesses outside the GE core-like insurance and media-to platforms that can leverage our strengths like Oil & Gas and Life Sciences. We expect this portfolio to deliver valuable growth and trade at a premium in the future.

Leading in Productivity


We are consistently innovating inside GE. In an "efficiency-starved" world, our innovations are focused on productivity. We are investing in three initiatives that can deliver big gains in productivity for our customers and GE.

We will lead as the industrial and analytical worlds collide. We believe that every industrial company will become a software company; that ultimately deep domain knowledge is tougher to come by than writing code. In this sense, GE seeks to link the "iron and the data." Our assets have sensors that produce a customized stream of performance data. We can harness this data to optimize performance. We know that smart machines, guided by domain-based analytics, in a distributed setting, will drive new levels of productivity. We call this the Industrial Internet.

Our customers want our assets to operate with no unplanned downtime and optimal performance. Small improvements in asset performance could impact $20 billion of benefits for our customers. We are delivering software and analytical solutions that can take data from our installed base and turn it into productive outcomes for our customers. We call our data solutions "Predictivity," and so far, we have launched 24 offerings generating $800 million of incremental revenue. We expect Predictivity revenues to exceed $1 billion in 2014.

Teams from UPMC and GE will re-imagine workflow using cloud-enabled technology to improve the way providers archive, access and interpret MRIs, CT scans and other imaging modalities.

Our systems can analyze the performance of individual engines in the Aviation installed base; this allows us to differentiate repairs, saving money and time for our customers. Through GE's Healthcare Asset Management, radiologists can keep "images in the cloud." This improves clinician productivity, expands networks of care and enhances diagnostic confidence. For our rail customers, one point of system efficiency is worth $2 billion of profit every year. In this market, GE delivers a complete solution from dispatch to network planning to train handling, called RailConnect 360. We plan to shift a substantial portion of our repairs to "condition-based" versus schedule-based; this will deliver substantial savings to our customers.

We will lead in advanced manufacturing. We spend about $72 billion each year in our factories. Material science and analytics are transforming the way that our factories can operate. Digital tools will make us faster and more efficient.

We are investing in high-performance computing so that we can reduce design cycle time. We are a leader in advanced fabrication innovations like 3D printing, to lower product cost and drive speed. We have digitized our supply chain to enable collaboration. We are at the leading edge of robotics and automation. Our factories are smarter, more distributed and reconfigurable.


Advanced manufacturing will create a meaningful impact for our investors. Our Aviation business has a $125 billion backlog of new products and services. We are launching one new engine each year for the rest of the decade. In the past, we might have outsourced 40% of these engines to global suppliers; in the future, we plan to manufacture more at GE, capturing an increased portion of supply chain value. Manufacturing is the basis on which we will compete and win in the future.

We will lead in the "age of gas." Energy is becoming the major driver of regional competitiveness. Shale gas in the U.S. is creating electricity costs that are substantially below the rest of the developed world. But the U.S. is not alone; gas is being discovered and developed around the world.

This is creating a "tipping point" for fuel substitution. Gas is replacing coal in power generation around the world based on efficiency and environmental impact. Gas is replacing diesel for distributed power and transportation. China plans to increase gas power generation by 10 gigawatts annually to clean its environment. Because of this trend, there are billions being invested in gas exploration, transportation and monetization to connect gas supply with demand. GE can participate in every step of the gas value chain.

The new drivers of productivity represent a trio of "only GE" applications. We are the only company that is linking iron and data. We are uniquely positioned to lead in advanced manufacturing. And, we can create the "total gas solution" because we are a technical leader at every step. We are investing to win.


We Are Simplifying Everything We Do

To achieve our goals, we must simplify GE. We compete across eight platforms in 170 countries with multiple regulators. Having lived through multiple crisis events in the past decade, we attempted to manage volatility through layers and reviewers. Like many companies, we were guilty of countering complexity with complexity: more P&Ls, more inspectors, multiple reviewers. Along the way, we had created a higher-cost structure, an artificial sense of risk management, and we were insulating our people from the heat of the market. If you want to see where speed and accountability go to die, watch the third review of anything.

We are transforming GE around the "culture of simplification." This is not a reorganization or an initiative. Rather, it defines the way we make decisions, work together and work with our customers. We are focused on efficiency, speed and market impact. We are driving decisions closer to markets and making our teams accountable for outcomes, not process.

We are driving a leaner structure. In administration, less is more. We have learned that fewer layers, simpler rules and more field empowerment actually improve execution and accountability. Every decision should have no more than two approvers: We should empower the experts in the market, reinforced by governance and best practice sharing. In addition, we plan to execute the majority of our administrative processes through shared services, with common standards across our businesses. This will make us more competitive. We expect to reduce our administrative overhead cost by $4 billion between 2012 and 2016. Ultimately, we will end up with selling and administrative cost of 12% of revenue; this is a world-class benchmark. Our Power & Water business is reducing its overhead by more than 20%, while increasing its number of new products and growing share. Our Healthcare business has eliminated one-third of its P&Ls, while improving customer responsiveness. We are creating more value with lower cost.

What happens when we combine a Silicon Valley startup mindset with Lean Six Sigma? The answer is FastWorks—a set of tools and processes to develop new products quickly, achieve better outcomes for our customers, and drive quality and competitive advantage.

All processes are faster. We have combined the principles of Lean Six Sigma with the culture of “The Lean Startup,” from Silicon Valley, in a process called FastWorks. It is based on fast action, quick adjustments and measured outcomes. FastWorks accelerates impact, learning, improvement and validation. Dual fuel power generation is an important product gap for our Distributed Power business. Our initial approach was an investment of $350 million and seven years of development. Using FastWorks, we will be in the market in 2014, while investing a fraction of the initial estimate. FastWorks is catching fire inside GE across multiple processes, improving speed and competitiveness.

We are increasing customer intensity. We have reconfigured all of our commercial processes to work at market speed. Our commercial teams are empowered to lead, supported by enabling functions that are measured on market success. We have increased the number of experts in the field to deliver for our customers. Because we have invested in our growth market framework, we can move commercial decisions closer to the customer. In our Aviation services business, 75% of the flow commercial deals are approved in the regions with quick turnaround. Our Company is beginning to feel the market speed.

In a digital world, the major source of scale advantage derives from a lean backroom structure with a foundation of information. GE will be a major beneficiary of cloud computing, simplified systems and mobility.

We will still make a few mistakes. But the biggest risks at GE are the inability to seize market opportunities, layers that block reality and leaders who are not personally accountable. Simplification is making us more competitive.

We Are Delivering for Investors


Executing our initiatives will deliver results for investors. We would like investors to view our financial performance as a multi-year plan with substantial progress reached each quarter and year. By 2016, we expect to have 70% of GE's earnings from our industrial businesses. We expect to have industrial margins and returns exceeding 17%, at the top of our peers. We expect GE Capital to generate good returns while delivering cash to the parent. We expect to generate more than $90 billion of cash to allocate, returning the majority of that to you in dividends and buyback. And, we plan to grow EPS each year.

We made progress in 2013. We earned $24.5 billion of segment profit, up 7%. We grew operating EPS by 9% and returned $18 billion to you through dividends and share repurchase. We ran the Company well, with margins expanding by 60 basis points and $17 billion of cash generation, excluding NBCUniversal deal-related taxes. GE Capital finished the year with Tier 1 capital above 11% and $75 billion of liquidity.

Our industrial segment earnings grew 5%. Performance was broad-based with four businesses growing earnings 10% or more: Aviation, Oil & Gas, Transportation and Appliances & Lighting. We ended the year with $244 billion in backlog, a record. GE Capital grew its earnings by 12%, behind strong performance in Real Estate and international lending and leasing. We continued to shrink our balance sheet; ending net investment was $380 billion at year-end, down more than 40% from our pre-crisis peak. With a shrinking balance sheet and massive financial strength, GE Capital was able to pay a $6 billion dividend to the parent.

At GE, we think simpler is better. Simplification means quicker execution and closer collaboration with customers. It’s a focus on efficiency, speed and market impact.

Our total shareholder return expanded by 38% in 2013, ahead of the market. We added $64 billion of market cap and, at $282 billion, are the sixth most valuable company in the world. At year-end, we increased our dividend by 16%.

In 2014, we have planned for our industrial earnings to grow by more than 10%. We expect organic revenue growth between 4%—7%. The big initiatives will fuel our success. Growth market orders expanded by 11% in 2013; this will translate into solid revenue growth. Our service revenue is $45 billion, and we expect solid revenue growth in 2014. We are planning for another year of substantial margin enhancement, beyond the 15.7% we achieved in 2013.

Margins have been an area of focus for GE. A decade ago, during the power bubble, we had artificially high margins. This has now been reset, and we have been making steady progress. Through simplification, we have made substantial reductions in structural cost. FastWorks is focused on equipment margins, which will be up substantially this year. We are restructuring our lower-margin businesses with a target of at least 10% margins for them in the near term.

GE Capital's earnings will decline in 2014 and 2015 as we exit Retail Finance. However, we plan to grow earnings in line with industrial growth thereafter. Our specialty finance franchises have strong positions with mid-market customers. We can originate new businesses at high margins.

We should have more than $90 billion of cash to allocate over the next three years, based on CFOA growth, balance-sheet efficiency, GE Capital dividends, and dispositions. We plan to return the majority of this cash to investors. Growing the GE dividend remains most important to the majority of investors. We will reduce our share count, aiming for a 10% reduction between 2012 and 2015.

We will accelerate growth through "bolt-on" acquisitions. Early in the year, we announced the purchase of Thermo Fisher's bioprocess manufacturing business in Healthcare, and Cameron's reciprocating compressor business in Oil & Gas. Both fit our model of opportunistic purchases where GE adds value through technology, global distribution and supply chain scale. Importantly, they allow us to complete market solutions for our customers.

Our plans for 2014 and beyond should be attractive to investors. You will see steady EPS growth, with a more valuable mix. We have substantial cash available to create shareholder value. I am investing right alongside of you. I have invested my entire bonus in GE stock and have purchased 145,000 shares so far this year. I now own 2 million shares outright, with another 2.8 million available if we perform. Like the rest of our leaders, I believe in GE.



At GE, we look at innovation through a broad lens. By taking breakthroughs in one business and applying them to others, we push expectations and change the idea of what's possible, all for the benefit of our customers.

Our Team Is Making Progress

Vscan was developed to provide better care in remote communities that lack access to conventional medical imaging technology. GE Healthcare originally created Vscan for use in China, and has since rolled out the system in more than 100 countries.

Jeff Bezos is an extraordinary leader and entrepreneur who founded Recently, he made the assertion that most businesses have short life spans. He said: "Companies come and go. And, the companies that are the shiniest and most important in any era, you wait a few decades and they are gone." But, GE has remained competitive because we learn and change. When we make progress, our investors are rewarded. The foundation of the Company is determined people with a winning culture.

At our kickoff meeting this year, the leader of our Ultrasound business—Anders Wold—gave a presentation about the power of ultrasound to solve global and rural health issues. In the 1990s, we were #7 in ultrasound. Today we are #1. In the past, we broke even; today we grow profits 15% annually at high margins. Ultrasound is a fast-paced, global business; and we are the best. If we trapped ourselves in dogma and slogans—don't try new things; big companies can't be fast; stick to what you know—we would have given up on ultrasound long ago. Instead, we are winning.

Kevin Nolan is a 24-year GE veteran who is VP-Technology of our Appliances business. He is a great engineer, well versed in GE training and process. We asked him to be a leader of FastWorks. Kevin grew up in the world of GE process and structure. Today, we need Kevin to move faster than our Korean competitors. Kevin has reached outside of GE for help. We set up a venture with Quirky, a collaborative manufacturing startup. Working together, we will make progress towards a six-month cycle for new products and rapid consumer feedback.

Jen VanBelle is a 15-year GE veteran. She is leading our efforts to strengthen GE Capital's regulatory capability. This is a job she couldn't have imagined or wanted five years ago. But Jen is a great, adaptable leader; and because of her, we can make progress toward becoming a model financial services company.

Around the world and in the U.S., our manufacturing teams tackle big projects, like the subsea blowout preventers built by our Deepwater Assembly teams in Houston, Texas.

Heiner Markhoff is a 20-year GE veteran who leads our Water business. Through his resilience and focused execution, we are turning this business into a successful GE franchise. More importantly, we are making progress in key infrastructure markets like industrial water reuse and unconventional fuels. This could be our "Ultrasound" for the future.

These are just a few examples of great leaders at GE. People love our Company because they are committed to the interesting and impactful work they do. They stay because they work with other great people. And this team is committed to solving the challenges of today's complex global business environment.

Our team is excited and united. We will execute the strategy: driving infrastructure leadership; investing in the innovation of efficiency; building competitive advantage; achieving a culture of simplification; and investing your cash wisely. We will deliver a financial performance that creates shareholder value. We will focus on what is important and move faster.


In December, I sat with four of the most pre-eminent brain scientists in the U.S. We discussed the advanced technology around treating diseases of the brain, from Alzheimer's to traumatic brain injury. They feel that GE can have a big role in treating brain disease through our leadership in diagnostics. This is one of the most interesting, promising and challenging horizons in healthcare.

I sat back and daydreamed about the Dubai Air Show. If we were able to make such strong progress in aviation innovation in five years—20% improvement in fuel efficiency—just think what we can do in the next five years to treat brain diseases. We are just the company to advance brain science.

That is because we believe in progress
… because we are willing to take risks
… because we are GE.


Jeffrey R. Immelt
Chairman of the Board and Chief Executive Officer
February 27, 2014



The GE Board held 14 meetings during 2013, including three meetings of the non-management directors of the Board. Each outside Board member is expected to visit at least two GE businesses without the involvement of corporate management in order to develop his or her own feel for the Company.

Board members focus on the areas that are important to shareowners - strategy, risk management, leadership development, and regulatory and compliance matters. In 2013, they received briefings on a variety of issues, including capital allocation and business development, risk management with a focus on GE Capital, business simplification, GE Customer Opinion Surveys, leadership development, technology excellence, IT and cyber security, global research and development strategy, Industrial Internet initiatives and GE's branding, marketing and operating initiatives. At the end of the year, the Board and each of its committees conducted a thorough self-evaluation.


Andrea Jung 2,3,5

Former Chairman of the Board and Chief Executive Officer, Avon Products, Inc., beauty products, New York, New York.

> Director since 1998.

Francisco D’Souza 5

Chief Executive Officer, Cognizant Technology Solutions Corporation, global information technology, consulting and business process outsourcing, Teaneck, New Jersey.

> Director since 2013.

James S. Tisch4

President and Chief Executive Officer, Loews Corporation, diversified holding company, New York, New York.

> Director since 2010.

James E. Rohr

Executive Chairman of the Board and former Chief Executive Officer, The PNC Financial Services Group, Inc., financial services, Pittsburgh, Pennsylvania.

> Director since 2013.

Robert W. Lane1,2

Former Chairman of the Board and Chief Executive Officer, Deere & Company, agricultural, construction and forestry equipment, Moline, Illinois.

> Director since 2005.

Robert J. Swieringa1

Professor of Accounting and former Anne and Elmer Lindseth Dean, Johnson Graduate School of Management, Cornell University, Ithaca, New York.

> Director since 2002.

Mary L. Schapiro4

Vice Chairman, Advisory Board of Promontory Financial Group, consulting firm, and former Chairman, U.S. Securities and Exchange Commission, Washington, D.C.

> Director since 2013.

Ann M. Fudge3

Former Chairman of the Board and Chief Executive Officer, Young & Rubicam Group, global marketing communications network, New York, New York.

> Director since 1999.

John J. Brennan4

Chairman Emeritus and Senior Advisor, The Vanguard Group, Inc., global investment management, Malvern, Pennsylvania.

> Director since 2012.

Marijn E. Dekkers2,5

Chairman of the Board of Management, Bayer AG, global healthcare, crop science and material science, Leverkusen, Germany.

> Director since 2012.

W. Geoffrey Beattie1,4

Chief Executive Officer, Generation Capital, investment company; former Chief Executive Officer, The Woodbridge Company; and Former Deputy Chairman, Thomson Reuters; Toronto, Canada.

> Director since 2009.

Ralph S. Larsen1,3,6

Former Chairman of the Board and Chief Executive Officer, Johnson & Johnson, pharmaceutical, medical and consumer products, New Brunswick, New Jersey.

> Director since 2002.

James I. Cash, Jr2,5

Emeritus James E. Robison Professor of Business Administration, Harvard Graduate School of Business, Boston, Massachusetts.

> Director since 1997.

Douglas A. Warner III1,2,3

Former Chairman of the Board, J.P. Morgan Chase & Co., The Chase Manhattan Bank, and Morgan Guaranty Trust Company, investment banking, New York, New York.

> Director since 1992.

Susan Hockfield3,5

President Emerita and Professor of Neuroscience, Massachusetts Institute of Technology, Cambridge, Massachusetts.

> Director since 2006.

James J. Mulva1,5

Former Chairman of the Board and Chief Executive Officer, ConocoPhillips, international integrated-energy company, Houston, Texas.

> Director since 2008.

Rochelle B. Lazarus3

Chairman Emeritus and former Chief Executive Officer, Ogilvy & Mather Worldwide, global marketing communications company, New York, New York.

> Director since 2000.

Jeffrey R. Immelt (not pictured)

Chairman of the Board and Chief Executive Officer, General Electric Company, Fairfield,

> Director since 2000.

  • 1 Audit Committee
  • 2 Management Development and Compensation Committee
  • 3 Governance and Public Affairs Committee
  • 4 Risk Committee
  • 5 Science and Technology Committee
  • 6 Presiding Director

Sustainability at GE

As a 130+ year-old technology company, GE works every day to solve some of the world’s biggest challenges. Safety and sustainability are embedded in GE’s culture and define the products we make, the services we offer and the difference we make in communities around the world.

In 2013,

  • GE businesses, employees, retirees and the GE Foundation contributed more than $215 million and an estimated 1.3 million hours to community organizations in 55 countries.
  • Through our ecomagination commitment GE reduced its environmental footprint, with a 47% reduction in freshwater use since 2006, and reduced greenhouse gas emissions by 34% since 2004.
  • We continued our 10-year improvement in protecting worker safety with a 37% reduction in recordable injuries since 2003.

GE and New York Stock Exchange have been partners for over 120 years and share a commitment to innovation. GE is a proud member of the NYSE Century Index. Component companies have demonstrated the ability to innovate, transform and grow through decades of economic and social progress. The NYSE Century Index is composed of major companies that define the American economy and business icons.
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GE is consistently ranked as one of the world’s leading corporations:


Most Valuable Global Brands

Working Mother

Best Companies for Working Mothers

Fast Company

World’s Most Innovative Companies


World’s Most Admired Companies


2103 Most Respected Companies


World’s Most Ethical Companies

Thanks to the customers, partners and GE employees who appear in this annual report for contributing their time and support.