GE’s US$1 billion investment in Saudi Arabia creates a path for new initiatives in localization

With the successful accomplishment of its US$1 billion investment commitment in Saudi Arabia over the past three years, GE (NYSE: GE) today announced further long-term initiatives that underlines GE’s transformation as a digital industrial company and its focus on supporting its partners in the Kingdom to achieve stronger operational efficiency and productivity. 

Jeffrey Immelt, GE’s Chairman & CEO, said: “GE enjoys a strong history in Saudi Arabia of over 80 years of operation, and we are a partner that has invested in the long-term growth of the nation. Our initiatives are aligned with the strategic development priorities of the Kingdom. Today, as GE marks its transformation as a digital industrial company, we look forward to further strengthening our technology innovation, localization, manufacturing and training programs.” 

The new initiatives announced under GE’s ‘Saudi 2020 Sustainability’ Program will result in critical outcomes aligned to the country’s growth priorities:

• Doubling GE’s workforce in the Kingdom from 2,000 to 4,000 by 2020
• Doubling its Saudi supplier base from 150 to 300 to build a strong Saudi supply chain that supports GE’s local manufacturing facilities 
• Doubling training in energy, healthcare and localized research for over 10,000 Saudi professionals through local and global programs 
• Focus on achieving US$100 million in value of exports of products and services from GE to different parts of the world including the US and Europe

The new initiatives are outlined as follows:

Technology Innovation + the GE Store

The Saudi GE Innovation Center, located in Dhahran Techno Valley, joins the family of GE’s select Global Research Centers. Now named the Saudi GE Technology & Innovation Center, it is the first-of-its-kind in the region with the principal goal of helping meet the Kingdom growing demand for power through highly optimized operations across the energy supply chain. The Center will include researchers from GE Global Research, GE Power & Water and GE Oil & Gas, further accelerating the pace of localized innovation and the adoption of Industrial Internet technologies for the Kingdom. 

The Saudi GE Technology & Innovation Center’s global research initiatives will focus on ‘hot and harsh’ technology programs for power generation and oil & gas applications as well as the Industrial Internet, accelerating software solutions and analytics. Dr. Nidal Ghizawi, a GE veteran of over a decade, has been appointed as the Chief Technology Officer of the Saudi GE Technology & Innovation Center.

The Center will also both benefit and contribute to the GE Store for technology. Being a part of GE’s global research network, scientists and engineers will be able to pull technical expertise from across GE’s industrial portfolio to accelerate localized innovations while at the same time contributing technology back to benefit GE’s businesses in other places around the world. 

This closely follows the announcement earlier this year of a US$100 million investment commitment by GE to regional research and technology, with emphasis on a Power Generation Hot and Harsh Center of Excellence, energy efficiency, oil & gas research, and the Industrial Internet. 

Localization and Manufacturing 

As part of GE’s long-term investment and partnerships in the Kingdom, GE will substantially increase its localization plans across the energy value chain by 2020. GE will support manufacturing and exports in Saudi Arabia through manufacturing and assembly of materials and components for heavy duty gas turbines and Oil & Gas equipment. Programs for the oil & gas sector include downstream and surface, building on GE’s current Pressure Control Facility and upcoming GE Oil & Gas Manufacturing facility. In addition, on power generation, GE’s heavy-duty 9HA gas turbines, the world’s largest and most efficient that lead the industry in output while using less gas-per-megawatt than any other turbine on the market, will be rolled out next year from the GE Manufacturing Technology Center in Dammam.

In addition, GE signed today a Memorandum of Understanding with the Ministry of Commerce and Industry focused on taking industrialization and manufacturing across the Kingdom into the next digital industrial era by deploying ‘Brilliant Factory’ technology. GE will collaborate with the Ministry of Commerce and Industry on sharing the company’s proven digital manufacturing capabilities with the country’s industrial sector to optimize manufacturing operations and reduce unplanned downtime.

This focus on local manufacturing, in turn, will boost the supply chain as GE will be looking with its local partners to find local suppliers. GE’s goal is to create US$100 million in exports from Saudi Arabia to different parts of the world through locally based facilities. This will be supported by a potential doubling in local supplier base, which is currently at 150, in the next five years. 

Training and leadership development

Growing talent and the next generation of leaders is core to GE’s culture, and the company is working closely with customers on bringing that expertise and capability to the Kingdom.  Through the Greenville Program for Saudi engineers and the Bio-Med Science Programs, GE is building the next generation of leaders across all key growth sectors, particularly, in energy and healthcare. GE plans to further strengthen the training offered for Saudi human capital development, and targets 10,000 young male and female engineers, technicians and technologists. In addition, the company will double its workforce from 2,000 to 4,000. 

Working together for growth 

To date, GE’s investment in the Kingdom has generated strong outcomes including:

• A 2,000 strong workforce with 50% staff in highly skilled engineering and technology roles and a Saudization rate of 70% 
• Building a supplier base of over 300 locally of which 150 are Saudi SMEs 

• Export of parts and services to more than 70 customers in almost 40 countries across Middle East, Europe and Africa, as well as the US
• Trained 6,000 Saudi professionals in leadership, clinical, and engineering programs in healthcare and energy sectors within Saudi and globally, as well as delivering tailored leadership experiences such as the Saudi Women Leadership Summit