- Credit accord with France's Coface means relocating production
- Packaging operations for some turbine sales also being shifted
General Electric Co., a longtime beneficiary of the U.S. Export-Import Bank, is moving 500 jobs to France, Hungary and China after Congress halted the agency’s ability to offer new financing.
“We’ve got $11 billion of active tenders that require some form of export credit financing,” GE Vice Chairman John Rice said Tuesday in a telephone interview. “We’ve got to start making some choices about where those products will be manufactured in order to qualify for export credit financing. Frankly, we’ve been pushed to do this.”
Positions in South Carolina, Maine, New York and Texas, including some Houston-based packaging operations for gas turbines, are being shifted, GE said. More than 400 jobs will go to Europe as GE implements a new agreement with French export credit provider Coface to back global power projects.
While about 55 percent of GE’s 305,000-person workforce was outside the U.S. at the end of 2014, the shifting of domestic jobs is a sensitive political issue. GE has been threatening such a move for months as it urges lawmakers to revive the agency, which provided almost $1 billion in credit assistance to the company’s international customers last year.
The White House on Tuesday put the blame for GE’s decision on congressional Republicans, who have blocked votes to reauthorize the Ex-Im bank. The company’s move shows “there are real-world consequences for congressional inaction,” press secretary Josh Earnest said.
The 81-year-old Ex-Im bank provides loans, credit guarantees and insurance to aid sales by U.S. companies including Boeing Co. and Fairfield, Connecticut-based GE. The bank’s charter expired June 30 amid opposition from Republican members of Congress, who say Ex-Im helps only a few large corporations that don’t need government assistance. GE says the loss of the financing imperils sales of products such as diesel locomotives, gas turbines and jet engines.
GE’s Ex-Im lobbying efforts in Congress include bringing smaller suppliers to Washington to show the fallout from the bank’s closing.
“This is not just about big companies like GE and Boeing,” Rice said. “That’s what the opponents of Ex-Im would want you to believe. It’s about the little companies that don’t have options. We can move production to France, but they can’t necessarily.”
More than 50 countries have export credit financing agencies, Rice said. Nations such as France have been “rolling out the red carpet” to woo U.S. manufacturers that may be harmed by the Ex-Im charter lapse, he said.
GE had already planned to boost employment in France in connection to the acquisition of the energy business at Alstom SA, which won European regulators’ approval last week. The company has pledged to create a net of 1,000 jobs in the country after closing the deal.
The fight over the bank is also affecting GE’s search for a possible new headquarters away from its longtime home in Connecticut. The company has ruled out cities such as Dallas over concerns about some lawmakers’ opposition to reauthorizing Ex-Im.