- General Electric has been an icon of American innovation and manufacturing for most of its history.
- The company reached its peak in 2000 and has had a rocky journey ever since.
- Now GE says it will split its three remaining divisions into three publicly traded companies.
By 1889, Thomas Edison had formed Edison General Electric from a handful of electricity companies he’d been operating.
Three years later, Edison merged his company with the Thomson-Houston Electric Company, and The General Electric Company was formed.
GE was included, on and off, for most of its existence until June 2018, when it was replaced by Walgreens Boots Alliance as one of the current 30 companies included.
One of his biggest acquisitions in 1986 – RCA, which owned NBC – advanced Welch’s goal of taking GE beyond manufacturing to become a “boundary-less” business.
By the time Welch stepped down in 2001, GE had grown to a nearly $US130 ($AU176) billion behemoth.
A lot happened during Immelt’s 16 years running GE.
The 2008 financial crisis dealt a huge blow to the company: Its stock fell 42% in 2008, forcing GE to rethink its operations. Warren Buffett even stepped in and invested $US3 ($AU4) billion to keep the company afloat.
GE quickly sold off some of its biggest past money-makers, like NBCUniversal, GE Plastics, and GE Water, and the selloff continued with financial services in 2014, home appliances in 2016, and oil and gas in 2017.
In spite of the company’s performance, Immelt maintained a pair of private corporate jets without telling GE’s board of directors. The day Immelt announced his retirement, June 12, 2017, GE stock went up 4%.
Although Welch publicly supported Immelt, he later admitted to other GE executives that the choice was one of his biggest mistakes, according to Fox Business.
The company lost over $US100 ($AU135) billion in market value during his tenure.
In November 2021, the company said it would spin off its last remaining three business divisions – aviation, healthcare and power – into separate publicly traded companies.
“This is the best way to fully realize the potential of these businesses,” Culp told the Wall Street Journal.
Even so, the GE’s share price is little changed compared to what it was when he took over three years ago. By comparison, the S&P 500 has climbed by about 60%.
Ivan De Luce contributed to an earlier version of this story.