GE Supports Transition of CEE into a Growing, Innovation-based Region - A Win-Win Situation
You might be more used to reading articles on this platform about products and technologies which GE sells worldwide. But can you imagine that GE buys from a network of more than 30,000 suppliers around the world with a value of such transactions amounting to 70 billion USD globally? These are incredible numbers and underline the importance of a sound and reliable supplier network.
Casey Ott, Managing Director of GE Aviation Hungary and Joerg Bauer President&CEO of Tungsram Group at GE Aviation plant in Veresegyház, Hungary. source: Tungsram
A highlight in terms of GE’s supplier network is the CEE (Central and Eastern European) region. GE has a steadily growing number of suppliers in this part of the world and its procurement value exceeds 1.7 billion USD, which it hopes to increase significantly through extending its SME (small and medium-sized enterprises) supplier base, fostering the development of regional suppliers and transferring its know-how on digital distributive technologies to its suppliers. Better connecting SMEs in CEE to the global economy via GE’s supply chain and developing innovative, future safe and digitally enabled SMEs means further increasing the competitiveness of the region.
Why is the CEE region such an interesting market? It has experienced unprecedented growth in the past 20 years. The source of that growth has been competitive labor costs, robust internal consumption and ambitious foreign direct investments. However, being efficient in pure technology absorption is not going to maintain economic growth in the long run, and the increase in productivity is getting closer to the boundaries of technology. Further growth needs different drivers and the real challenge will be how GE supports the transition of CEE into an innovation- based region. Increased and stronger cross-border collaboration will drive the growth of SME suppliers in CEE.
One example of such a successful cooperation between GE and a regional supplier is Tungsram, a European lighting company. Following a close coordination within the framework of GE’s Supplier Program over the last 12 months, Tungsram has won the opportunity to further extend its supply network with several GE Businesses. As a highlight, Tungsram has invested 1.5 million USD to create a new shop operation concerning inspection and maintenance of aircraft engine components in its plant in Kisvárda, Hungary for GE Aviation.
„GE Aviation Hungary works competitively to secure volume and build capabilities to better serve our customers. Our goal is to grow repair capability locally in Veresegyház and through partnerships in this region” – explained Casey Ott, Managing Director of GE Aviation Hungary Kft., located in Veresegyház.“
GE Aviation has a rapidly growing portfolio of commercial engine products, all of which have long life-cycles. Its need for global repair and maintenance capacity is always a priority.
“We are proud to see how quickly and effectively Tungsram integrated into GE’s supply chain by transforming and upgrading its already existing processes and by also creating new capabilities in Kisvárda”, said Endre Ascsillán, Vice President of GE Hungary about the cooperation.
There is no better proof point of GE’s commitment to its existing and potential SME supplier base in the CEE region than bringing two high-profile events to Budapest, Hungary this year. GE Renewable Energy, a Business expected to be GE’s highest-growth performer in 2019 hold its Global Supplier Conference as well as GE Power, whose technology represents one third of the world’s electricity production organizes its European Supplier Summit in the city. These events provide a further opportunity for established suppliers to extend their access to global energy market.
