GE leaps forward with two key deals

09:06 | 30/05/2016
US-based global industrial giant General Electric has secured a firmer foothold in Vietnam through the signing of two game-changing agreements during US President Barack Obama’s first official visit to the country last week.
The deals with GE will aid Vietnam’s renewable energy targets and revolutionise VietJet Air’s fleet

The first deal is a memorandum of understanding (MoU) between General Electric (GE) and Vietnam’s Ministry of Industry and Trade (MoIT), which will increase the country’s supply of renewable energy. GE will build upon its 20 years in Vietnam through the development of new wind farms with minimum capacities of 1,000 megawatts by 2025 – enough electricity to supply 1.8 million Vietnamese homes.

Under the agreement, GE will utilise its wind power development expertise and work with local developers to identify potential projects. Furthermore, GE will manufacture wind turbine equipment and components at its $110-million Haiphong facility while collaborating with other local suppliers.

“The development of renewable energy is a high priority of the Vietnamese government in order to help the nation resolve its energy challenges and meet economic and social development targets,”said Dang Huy Cuong, director general of the MoIT’s General Department of Energy. “We have a common desire to develop the renewable energy infrastructure in Vietnam through this partnership, and we highly appreciate GE’s expertise and experience in developing this crucial power resource which can mitigate the environmental impacts of climate change.”

GE makes both onshore and offshore wind turbines. Its Haliade turbines, for example, will power America’s first offshore wind farm, which is due to come online later this year. GE is also connecting wind turbines to the Industrial Internet to create “digital twins” of entire wind farms and make them more efficient.

“With GE’s global expertise in manufacturing and investing in wind energy, along with our local experience gained through our initial wind projects in Vietnam, we hope to continue co-operating with the Vietnamese government and its partners to develop renewable energy here effectively and sustainably,” said Pham Hong Son, chief executive officer (CEO) of GE Vietnam.

GE also played a key role in the development of the Mekong Delta’s first wind farm in the southern province of Bac Lieu, invested in by Cong Ly Construction-Trade-Tourism Company. GE supplied 62 wind turbines, totalling over 99MW in power generation capacity. The first phase of this wind farm connected to the national grid in June 2013.

In 2009, GE increased its investment in Vietnam by establishing a wind-turbine components manufacturing plant in the northeastern city of Haiphong. The facility has created over 600 local jobs and has exported thousands of generator systems and wind turbine components.

The second deal signed last week is an order to the tune of $3 billion for 215 LEAP-1B jet engines. The engines, which use 3D-printed components and other advanced technology innovations, were developed by CFM International, a 50-50 joint venture between GE Aviation and Safran Aircraft Engines. The engines will power a brand-new fleet of 100 next-generation Boeing 737 MAX aircraft operated by Vietnam’s first privately owned airline, VietJet Air.

“It has been a real privilege to work with VietJet Air on the CFM56 fleet and we are excited to bring the value of the LEAP engine to its operations,” said Jean-Paul Ebanga, president and CEO of CFM International. “In a very short time, the team has established itself as the fastest-growing airline in the region, and we believe they are just getting started.”

The LEAP is the first jet engine with 3D-printed parts and components made from advanced ceramics that GE originally developed for powerful gas turbines. These components help to make the LEAP engine quieter, easier to maintain, and 15 per cent more fuel-efficient than current engines made by CFM. The first Boeing 737 MAX powered by a pair of LEAP-1B engines took its maiden flight this January. CFM also developed LEAP variants for the Airbus and COMAC airplanes.

Prior to the VietJet Air deal, CFM International had received more than 10,500 orders for LEAP models from nearly 100 customers around the world, with the value of the orders topping $147 billion.

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By By Hoang Anh

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