Company predicts double-digit growth for 2007, pulled by Erie locomotives
The Evolution series locomotive represents more than Erie's latest offering.

It's also a symbol of how the global economy can work for a company, General Electric Co. Chief Executive Jeff Immelt said Tuesday.

Immelt referred to the Erie-made locomotive in his annual December outlook meeting with investors in New York City, calling the Evolution an example of how going global can rejuvenate a business.

A rush of orders from around the world has helped double business at the Lawrence Park plant in just three years, from $2.1 billion to $4.2 billion, plant spokesman Patrick Jarvis said. It has also created more than 700 jobs.

The company will build about 850 locomotives this year in addition to continuing to run a thriving service division, and manufacturing diverse products such as off-highway vehicle drive-train systems and gearing systems for wind turbines, Jarvis said.


Jarvis said Immelt's comments indicate that the company's good fortunes are expected to continue in 2007.

"It's an exciting time to be part of what's considered one of the premier global growth companies," Jarvis said.

"This is a business that is exporting products around the world."

Jarvis said the Evolution is currently being made for customers in China, Kazakhstan, Australia and Mexico. He said there is also "solid interest" from numerous other countries.

Globalism is a dirty word in this region as it has chipped away at Erie's economy for years while thousands of local jobs have moved overseas. But Jarvis said the Evolution has allowed GE Transportation -- Erie County's largest employer with 4,500 workers -- to enter new markets around the world.

He said that is evident this week as some of the top executives from the local plant are currently in China and Belarus.

"When we talk about global growth, it does impact the Erie region because many business leaders here are out working on those projects," Jarvis said.

Jarvis said the local plant has invested a lot of money in the building itself in recent years. He said putting money into various parts of the manufacturing process will help ensure that GE Transportation can produce enough products to remain a leader in the field for years to come.

He said locomotives are just part of what is being manufactured at the local plant. The plant has a varied output including locomotive parts as well as mining equipment that also allows it to remain competitive.

Immelt said GE's infrastructure division, of which the local plant is a part, is one reason why earnings are expected to increase 15 percent to 16 percent in 2006, an increase to a range of $1.97 to $1.99 a share. He said that in 2007 the company expects an earnings increase of 10 percent to 13 percent, to $2.17 to $2.23 per share.


Revenue is projected to rise to $175 billion in 2007, an 8 percent increase.

Immelt was optimistic about the strength of the infrastructure division, which comprises about 35 percent of the Fairfield, Conn.-based company. He said the division is up 16 percent in 2006 and expects it to be up by 15 percent to 20 percent in 2007.

"We're winning," he said. "This is a business where we gained market share across the board. ... Our orders are growing."

Immelt said the company will continue to position itself for long-term performance. He said one of GE's strategies for 2007 will be to continue investing in new capabilities and services and to reinvest in its existing infrastructure, as it has done at the Erie plant.

Immelt's 2007 forecast sat well with investors as GE shares rose 42 cents, or 1.2 percent, to close at $35.64 in Tuesday trading on the New York Stock Exchange.

The Associated Press contributed to this story.

SCOTT WALDMAN can be reached at 870-1738 or by e-mail.


By The Numbers