GETransportation
2
20%
Transportation
• Expand profitability of core N.A. businesses with technology & operating excellence
• Extend business reach to global markets
• Build strong adjacencies with technology & market synergies
– Propulsion systems
– Signaling & “Avionics”
– Power storage
29%
18%
2003
$0.5
2006
$0.8
Revenue
SegmentProfit
$2.5$4.2
$2.4
$5.1
Global demand & technology fueling growth
($ in billions)
Business imperativesOrdersBacklog
CAGR
3
Environment
Global trade … Commodities, coal & finished good flows driving growth on land & sea
Emerging markets growth … GDP growth gated by rail & mining infrastructure
North America market growth … industry strong, investment focused on productivity, fuel, service, & emissions … backlog growing
Capacity challenges & fuel cost … Driving advanced technologies
Highway congestion & labor… Challenging truck capacity
Aging fleets … Being upgraded for fuel, emissions & reliability
Strong fundamentals
4
Global growth
Global expansion driven by emerging mkts, commodities growth
17
25 25 26 27
N. Am China Russia/CIS India L. Am
• RR’s critical in developing countries
• Coal & commodity growth
• Freight corridors, land bridges & mining
• Emphasis on reliability, life cycle, & emissions
Approx.Fleet Size
27,700 11,400 13,600 4,900 3,600
2003 2004 2005 2006 2007e
Global backlog (locos)
Key Wins:• Kaz/Russia/CIS (Loco’s, Mods, OHV)• China (Locos, Signaling, OHV, O&G, M&S) • Middle East/Africa (Loco’s, M&S, Parts) • SEA/ANZ (Loco’s, M&S)• Europe (Loco’s, Mods, Signaling, M&S) • S. America (Loco’s, OH’s)
30110 120
640
760
Age of fleet (years)
5
Hybrid technology, fuel & emissions
N.A. Class 1 RR Op Ex
(annualized est, $B)
Investing in leadership technologies
Transportation Fuel MGPP
Product Enhancements
•Combustion optimization (’08)
•Trip Optimizer (’09)
•Common rail fuel injection (’10)
Alternative Fuels•Locomotives Low sulfur, Bio-diesel
•Stationary power gen Palm oil
•Marine engines Marine diesel oil
Hybrid Locomotive
•May ’07 demo in California
•Prototype loco 2010
•Targeting 10%+ fuel & emissions benefits
•Fuel ~20% of class 1 Op Expense annually•2% fuel savings yields ~$200MM annual benefits
Fuel20%
C&B40%Other
Op Ex40%
~15% benefit
6
Propulsion adjacencies
LocomotiveControl & System Design
Marine Propulsion OHV Propulsion
• Our knitting … Engines, AC Propulsion, Generator, Wheel Motor, Control, Gears … Batteries next
• Leverage system design/control … technology advantage
• Higher value add … compete as propulsion system vs. component supplier
Propulsion business generating 30%+ loco business & growing
Drill Systems Power Storage
7
1996 2001 2006
NA Int'l
Signaling & Rail ops revenue
($ in millions)
Leveraging technology to improve global asset management
Dispatching
Signaling
“Avionics”
$310
$550
Signaling, solutions & “avionics” in Rail
8
Fuel Savings 10% savings vs. operators
Train Coverage All Cargo
(e.g. Coal, Inter-modal)
Network Coverage in All Territories
(e.g. Mountains, Undulations)
Training < 2 hrs./Operator
% Trip in Auto >60%
Fleet Coverage 10,000 NA units
PTC Interface Common Components
(e.g. Wireless, Track DB)
In-cab technology to drive fuel & RR productivity
System overview:
• GPS + Forecasting Tools
• Automatic Throttle Control
Key deliverables
“Avionics”
Ton-Mile/Gallon
RR Operators
10+% Fuel Savings!
Trip Optimizer
9
Transportation summary
Global transportation market … fundamentals are
strong
Strong backlogs … equipment & services
Expanding CM’s … in core business from technology
& ops excellence
Rapidly globalizing … successful N. America business
Building propulsion adjacencies … technology
synergies
Building an “Avionics” business … market synergies
GEInfrastructure
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