The Shanghai complex also will serve as GE’s China headquarters, helping the company with its efforts to “localize” its product lines for the China market. Overall, GE has 12,100 employees in China.

Late last month, GE also said that it would soon be delivering the first of 300 advanced locomotives to China, with the remainder arriving by mid 2010. The first two locomotives - from a contract signed in 2005 - will be shipped fully assembled from the United States. But the remaining 298 will be shipped as “kits,” with the local content gradually rising - until it reaches as much as 80%, said Lorenzo Simonelli, the global president of GE Transportation. The first locomotive will be assembled in China next month.

“They will have up to 80% local content,” Simonelli told Reuters on the sidelines of a press conference to announce the delivery of the trains, which are valued at $450 million. “It really is a localization effort.”

By boosting the local content, GE increases the contract’s profit potential, said Tim Schweikert, the president for GE Transportation’s China unit.

GE was also a major sponsor for the just-concluded Summer Olympic Games in Beijing, and said it generated $1.7 billion in revenue from that event - including $700 million in sales of power-equipment and other products for sports venues, and another $700 million from advertising for NBC, the U.S. broadcaster for the games.

Overall, companies such as GE and The Coca-Cola Co. (KO) spent as much as $400 million each on Olympics sponsorship and marketing programs, estimates IEG LLC, a firm that tracks corporate sponsorships. About $70 million to $80 million of that total consisted of a one-time payment for the right to sponsor the games, and the rest included advertising and marketing, as well as product promotion, The Wall Street Journal reported.

GE used the Olympics as a venue to host 2,000 customers and guests from around the world, wining and dining them, taking them to top tourist spots and providing tickets to Olympic events. Immelt himself played host at some of these events, the company said.

Zig When Rivals Zag

Although it’s been badly stung by the U.S. downturn, Immelt recently told journalists that he’s looking to benefit from the malaise, as well. With prices now depressed for entire companies, unwanted divisions, and even some product lines, GE expects to find some “great deals” on possible buyout targets.

“Some of the best opportunities we’ve seen in the last 10 years we’re seeing right now - assets are cheap,” Immelt said. “In financial services, sometimes bad news is good news. You’ll see some great deals done in this cycle, and we’ll do some of them.”

But it will be a seller, as well as a buyer.

GE plans to shed its lighting business, as well as its home-appliance unit. While current plans call for both units to be spun-off as standalone units, Immelt said GE is still open to offers from prospective purchasers. Two companies mentioned as possible bidders on the home-appliance unit include:

• LG Electronics Inc., a South Korean electronics and telecommunications giant that’s positioning itself as a global heavyweight.
• And the Haier Group Co., a China-based appliance-maker that’s one of that country’s real corporate success stories.

“There’s a lot of interest in it,” Immelt said of the home-appliance unit. “This is a great way to expand into the United States. Our base case is to do a spin to investors, but I think the appliance business makes sense to a lot of people out there.”

GE has no plans sell its NBC Universal media unit, even though investors have repeatedly pressured GE to sell or spin-off a business they say has no real connection to the chief business activities of an industrial and financial conglomerate.

“I always say: ‘Look, it’s a good business. We run it well’,” Immelt said. “We’ve never contemplated it [a sale]. We don’t think about it. We like the business.”

Source:  New Look General Electric Aims to Double its China Business by the Decade’s End

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