GE’s Immelt Says He’d Move Jobs Overseas If Ex-Im Bank EndsKathleen Miller
General Electric Co. Chief Executive Officer Jeffrey Immelt threatened to move U.S. jobs overseas if Congress doesn’t reauthorize the Export-Import Bank’s charter, which expires at the end of June.
“We’re not going to lose this business,” Immelt said Wednesday to the Economic Club of Washington. “We’ll build these products in places where export credit financing is available.”
GE’s product lineup includes diesel locomotives, medical-imaging equipment and gas turbines. It’s also the biggest maker of jet engines, a business that risks being crimped without the Ex-Im financing for Boeing Co. jets.
Congress faces a June 30 deadline to reauthorize the 81-year-old bank, which provides loans, loan guarantees and insurance to aid overseas sales by U.S. companies. Once renewed regularly without controversy, Ex-Im has become a target of conservative Republicans who say it benefits only a few large corporations that don’t need government assistance.
The loss of jobs is “a mighty high price to pay for ideological purity,” Immelt said.
After the speech, Immelt told reporters, “It’s very unlikely anything happens by June 30, so we’re going to have a lapse.” He said he expects the bank will eventually be reauthorized by Congress.
“We’ll keep pushing,” he said.
Immelt also urged lawmakers to support fast-track trade negotiating legislation now stalled in Congress.
Backing the trade measure “is a chance for Congress to show their concern for small business is more than just talk,” he said. “If you’re on the side of small and medium-sized businesses, you should be voting for free trade.”
Immelt rejected the idea that trade deals are bad for U.S. workers.
“GE union workers are going to suffer if these trade deals don’t pass,” he said. He said he expects Congress to pass the trade legislation and reauthorize Ex-Im, adding, “I think ultimately this gets solved.”
GE, one of the top three public company exporters in the U.S., has much to lose if the Ex-Im bank disappears: its overseas customers received more than $973 million in credit assistance from the bank last year, according to an Ex-Im annual report.
If the bank’s charter lapses, “a few think tanks will send out alerts that they won,” Immelt said. Meanwhile, in Berlin and elsewhere, foreign competitors “will have reason to celebrate.”
‘Clears the Field’
“Doing away with Ex-Im Bank basically clears the field of competition” for overseas rivals, he said.
Ex-Im proponents say most members of Congress would support reauthorizing the bank if they were allowed to vote on the issue. No vote is scheduled before the end of the month, though, which makes it likely the bank’s charter will lapse.
The bank would still be able to administer the transactions it has already underwritten but would be unable to approve new ones.
Immelt has previously said that if Congress allows the bank to die, GE may move work to other countries with export credit agencies.
“If, God forbid, if it was ever something so stupid as that the Ex-Im went away, we’d just move production around and take advantage of other places,” Immelt said at an industry conference on May 20.
Immelt plans to visit Capitol Hill to reiterate his support for the trade legislation and Ex-Im reauthorization. GE this year has sent lobbyists and executives including Russell Stokes, president of its transportation division, to meet with lawmakers and press for the bank’s reauthorization.
The company might lose an Angola locomotive deal valued at as much as $350 million and perhaps billions of dollars in future exports if Congress doesn’t extend the bank’s charter, said Jessica Taylor, a spokeswoman for GE’s transportation division.
Immelt said Wednesday that if an Ex-Im lapse affects the Angola deal, “we’ll attempt to get other ways to move through it.”
About 1,800 jobs at GE, its suppliers and local businesses in 12 states are at risk without the bank’s financing, according to Taylor.
The U.S. Senate showed strong support for reauthorizing the bank in a test vote June 10, bolstering backers’ argument that a majority of Congress wants to keep the bank around. The 31-65 vote kept alive a proposed amendment to extend the bank’s charter, though the measure was withdrawn immediately afterward.