GE CEO Larry Culp Talks Company's Evolution, Aerospace Division

Summary

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Podcast Summary: GE CEO Talks Company's Evolution

Podcast: Bloomberg Talks
Host: Bloomberg (interviewer: Guy Johnson)
Guest: Larry Culp, CEO of GE Aerospace
Date: June 7, 2026
Location: Live from Rio, with context from recent industry events in Beijing and New York

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Overview

This episode features a timely conversation with Larry Culp, CEO of GE Aerospace, focusing on the company’s evolution amidst global challenges, supply chain complexities, industry competition, and innovation in engine technology. The discussion provides insights into how GE Aerospace navigates an uncertain aviation environment, the ongoing supply chain recovery, future opportunities with China, and GE’s strategic vision for upcoming engine generations.

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Key Discussion Points & Insights

1. Market Resilience Despite Turbulence

• Current Situation:

  • Ongoing global conflicts and elevated fuel prices are impacting aviation, but Culp describes strong, continued demand for GE Aerospace’s products and services.
  • Significant metrics:
    • Spare parts orders up 30% in Q1, and even further up to 40% year over year.
    • Aircraft retirements are down; engine removals (a precursor to shop visits) are up.

  “It's interesting because we thought we might see some change in airline behavior, but we really haven't.”
  —Larry Culp [01:09]

• Lesson from Pandemic:

  • The industry learned that “things come back, they come back sooner and... stronger than we would ever have anticipated.” [01:56]
  • Airlines remain focused on maximizing the summer flying season and are preparing for longer-term stability despite conflict-related uncertainties.

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2. Preparing for Post-Summer Downturns

• No Noticeable Shift Yet:

  • GE expected more caution from airlines given Gulf tensions, but “airlines really have not changed the way they are servicing today's fleets...” [02:54]

• Key Indicators to Watch:

  • Culp keeps an eye on spare parts, retirements, and engine removals for early signs of industry slowdowns.

  “What we're going to be looking for are those same indicators I mentioned earlier... What's happening with spare parts orders?... Retirements?... engine removals?”
  —Larry Culp [03:31]

• 2026-2027 Outlook:

  • Confident in “mid teens” growth for services; medium-term trajectory looks strong.

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3. GE’s Strategic Preparation

• Robust Backlog:

  • GE’s backlogs for both narrow-body and wide-body aircraft engines are healthy “well into the 2030s.”
  • Over one million passengers are “in the air at any one point in time, with our engines underway.” [04:40]

• Focus Areas:

  • Manufacturing operations and partnerships with suppliers are being strengthened.
  • Leap engine deliveries up over 60%, services revenue up 30%.

  “We want to make sure that we're in a position to continue to support the airlines in whatever way we do well into the next several years.”
  —Larry Culp [05:13]

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4. Taming the Supply Chain Challenge

• Post-Pandemic Recovery:

  • GE experienced eight consecutive quarters of improved supplier performance.
  • The approach is now “deep technical, collaborative problem solving”—not simply ‘winning the war.’
  • Increasing capacity and efficiency is a long-term challenge.

  “There'll never be a moment where we're finished because we have to do more in the back half of this year than we did in the first half...”
  —Larry Culp [06:36]

• Ongoing Collaboration:

  • Supply chain improvements enabled significant increases in both new deliveries and services, and this effort will continue through the decade.

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5. Competitive Position and Customer Focus

• Competition with Rolls-Royce:

  • United Airlines' CEO Scott Kirby praised GE; industry peer Rolls-Royce is in transformation.
  • Culp maintains a focus on customer needs over direct competition:

  “If we focus on the airlines and what they need ... we live with these engines from delivery for 20 or 30 years.”
  —Larry Culp [07:52]

  • 2026 is described as “the year of being more customer driven.”
  • When pushed about competition:

    “I'll let you and others talk about where our competitors are.”
    —Larry Culp [08:24]

• Philosophy:

  • The board and senior team stay “focused on the customer. Customer will, will lead the way.”
    —Larry Culp [08:34]

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6. China Relationship & Future Orders

• Anticipation of Growth:

  • Speculation around upcoming U.S.-China summits, with Culp hinting at groundwork being laid for further deals:

  “I think the foundation was ... laid. The door is open and it'll be a good bit of work.”
  —Larry Culp [08:46]

• Long-Term Process:

  • Progress with China is “a journey” rather than a single event.
    —Larry Culp [09:07]

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7. Next Generation of Aircraft Engines

• Current Engine Lineup:

  • GE’s Leap and GenX engines are still “relatively new,” while the GE90, the “workhorse,” is just “a teenager, not a mature adult.”

  —Larry Culp [09:41]

• Customer Wishes:

  • Airlines want reliability above all: “just fix what we've got right now and make sure it works properly.”

• Innovation Path:

  • Investment started now for the next-generation, possibly “10 or 15 years out,” is essential.
  • Open fan (open rotor) architecture is positioned as both more durable and much more efficient.

  “We need to be investing in 2026 to be ready for that next-generation narrow body... the open fan architecture will allow us to address those reliability and durability concerns as well as deliver the next breakthrough in efficiency and sustainability.”
  —Larry Culp [09:56]

  • Promise of simultaneous gains:

    “...the technology breakthrough that allows us to do both. As my friend Jim Collins would say, to employ the genius of the and durability and efficiency.”
    —Larry Culp [10:32]

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Notable Quotes & Memorable Moments

• On Market Momentum:

  “We were up 30% in the first quarter. We've actually seen those spare parts growth rates increased to 40% year over year.”
  —Larry Culp [01:15]

• On Supply Chains:

  “There's no way that we take our leap deliveries up over 60% in the first quarter... if we weren't improving the supply chain.”
  —Larry Culp [06:09]

• On Long-Term Collaboration:

  “If we're together, nobody wins. But if we're collaborating, everybody [wins].”
  —Larry Culp [06:48]

• On Innovation Philosophy:

  “We couldn't agree more... working to improve the durability and reliability of those engines. That said, we need to be investing in 2026 to be ready for that next generation.”
  —Larry Culp [09:39]

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Key Timestamps

• 00:24 – Interview introduction and context
• 01:06 – Current industry impacts, spare parts growth
• 02:33 – Regional variations and post-pandemic lessons
• 03:31 – How to spot an upcoming downturn
• 04:33 – How GE Aerospace is preparing strategically
• 05:23 – Supply chain progress and future outlook
• 06:50 – Competitive landscape, focus on the customer
• 08:36 – China opportunities and upcoming US visit
• 09:09 – Transition to next-gen engines, reliability & innovation
• 09:56 – Why open fan technology matters for efficiency and durability

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Conclusion

Larry Culp’s interview showcases GE Aerospace’s confidence in both its short and long-term outlook despite global disruptions. The company is doubling down on customer partnership, robust supply chain collaboration, and calculated technological innovation (notably open fan engines), while remaining attuned to geopolitical shifts and competitive forces. Culp’s tone is pragmatic yet optimistic, focused more on proactive improvement and collaboration rather than reactive strategy or competition.

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Transcript

[Indiana University Narrator]

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[Larry Culp]

Bloomberg audio

[Guy Johnson]

Studios Podcasts Radio News.

[Bloomberg Host]

Right now we're going to head back to Brazil to hear from the CEO of GE Aerospace. Ge, of course, a major conglomerate that is split up and gone into pieces here over the last few years. Larry Culp is the CEO of GE Aerospace. Guy Johnson, our colleague from London, is in Rio for that interview. He joins us now. Guy, over to you.

[Guy Johnson]

Thank you very much indeed. Yeah, Larry is here. Nice to see you, Larry. Thank you very much indeed for spending time with us and time with us this morning. Let's talk about the here and now to start the conversation off. And, and we're in a situation where we've got, we've got a war that's having an impact on aviation. It's having an impact on fuel prices. What impact are you seeing right now for G's Aerospace as a result of what is going on?

[Larry Culp]

Well, Guy, first of all, thanks for the opportunity to visit with you this morning. And what we've seen really is nothing but a continuation of the strength that we saw through the first quarter of this year. It's interesting because we thought we might see some change in airline behavior, but we really haven't. I look at spare parts orders on a regular basis. We were up 30% in the first quarter. We've actually seen those spare parts growth rates increased to 40% year over year. We've seen retirements tick down. We've seen engine removals, which are really a precursor to a shop visit, actually tick up at a rate faster than we can complete the shop visits currently. So what I think we see are airlines very focused on making the most of the summer flying season.

[Guy Johnson]

Yeah.

[Larry Culp]

But also making preparations for the other side of the situation in the Gulf. Because the lesson I think we all took from the pandemic was things come back, they come back sooner and they come back stronger than we would ever have anticipated.

[Guy Johnson]

But you're surprised it's coming later. That, I guess, is the takeaway from this part of the conversation. You thought we may have seen it already?

[Larry Culp]

I would have thought we would have seen a little bit of change in airline behavior, but we haven't seen that yet. So, yes. Surprised? Pleasantly.

[Guy Johnson]

So if you, when it comes and you start to see some effects of this coming through, does it start in the Gulf? Is there any hint at this point that maybe some of the Gulf carriers start deferring, start changing behavior. Is that where it be begins and it spreads out?

[Larry Culp]

Well, I think the airlines around the world are being impacted in different ways. So depending on where you are geographically, the market segment you serve, you're seeing different impacts or looming impacts on your business. Clearly we've seen a number of airlines that have adjusted their schedules over the next several months. So that's happening. But in terms of the interface that we have, again both with respect to keeping the planes they have today in the air during this prize summer flying season, but also making preparation for the other side of the conflict, the airlines really have not changed the way they are servicing today's fleets and preparing to expand and modernize.

[Guy Johnson]

But where do you think it, what does it look like when it shows up? What does it look like when we start? We get through the summer, we get into the fall, into the autumn. What am I, what are the early things that we kind of watching the aviation sector, looking for clues that things are maybe starting to slow down or there's an effect. What do I look for?

[Larry Culp]

I would just strip. Well, what we're going to be looking for are those same indicators I mentioned earlier. Right, right. What's happening with spare parts orders? Okay, what's happening? Retirements, what's happening with engine removals? Are airlines in a position where they can't or have decided not to prepare for the other side? We were out a week and a half ago at an investor conference in New York and what we basically reiterated is that in 2026, given what we see, we feel very good about our services growth.

[Guy Johnson]

Yeah.

[Larry Culp]

Coming in to it at a mid teens rate and our medium term outlook, which has our for 2027. So I don't want to in any way suggest that nothing might happen. But from what we see right now, a hyper focus on the near term and preparations for the other side, how

[Guy Johnson]

do you get GE ready for that? What do you do? Are you getting it ready? Are you preparing for a storm? Is it kind of, what are you thinking about in terms of the way you run the business to get ready for that? Because that's the lesson of the past, the recent past is get ready, use this time wisely to prepare for that kind of a story.

[Larry Culp]

Well, I couldn't be more pro of the way the GE aerospace team is dealing with both the short term and getting ready for possibilities. But again, when you look at our business, given the strength of the backlogs that we have both in narrow Bodies and wide bodies well into the2030s. The significant demand that we have supporting a million passengers in the air at any one point in time, with our engines underway, a lot of what we're doing, not only in our own operations, in our manufacturing and our service footprints, but also in partnership with our supplier partners, has given us the opportunity to put up the numbers that we did in the first quarter to see leap engine deliveries up over 60%, for example. So a lot of good growth. We want to make sure that we're in a position to continue to support the airlines in whatever way we do well into the next several years.

[Guy Johnson]

You brought. You bring up the supply chains. Let's talk about that for a moment. Post pandemic, the supply chain has been the issue. Trying to get the supply chain to work, to deliver has been the challenge. Are you beginning to win that war now? Is that, is that battle turning in your favor? Do you think you've got this situation under control in a way that you haven't for maybe the last few years?

[Larry Culp]

We have eight quarters now sequentially where we have seen significant increases in inputs from our critical supplier partners. I think what we've actually done is thrown the winning the war framework out the window and gotten into deep technical, collaborative problem solving, making sure we're making the most of existing resources with supplier partners while we're investing medium to long term in additional capacity. There's no way that we take our leap deliveries up over 60% in the first quarter. No way. We have our services revenues up over 30% if we weren't improving the supply chain. The challenge guy that I think a lot of people don't appreciate is this is a wonderful opportunity that we'll be wrestling with for the rest of this decade. There'll never be a moment where we're finished because we have to do more in the back half of this year than we did in the first half of this year. The same will be true in 27 and 28. That's the beauty of having $170 billion worth of backlog. Right? We know for the rest of this decade we're going to get better in our own operations and in partnership with our suppliers. But if we're together, nobody wins. But if we're collaborating, everybody.

[Guy Johnson]

That sounds like you're winning, that sounds like you're in a much better place right now in terms of competition. Let's just talk about competition for a moment. You are in a good place right now. Scott Kirby at United has been singing your praises this morning, talking about you guys and the job that you're doing. He's taught less favorably about the competition. Rolls Royce. Rolls Royce has gone through, is going through a transformation right now. It will emerge from that at some point. Does competition get tougher further down the road when, when 2fan is, is in a different position, when he's got a handle on that business and a handle on his engines, does competition get tougher?

[Larry Culp]

Well, first off, I'm delighted to hear Scott's comments. We're celebrating with United 100 years of their operations and our partnership with them. Scott's a friend. We're focused on the airlines. Right. If we focus on the airlines and what they need, and that's the beauty of our business guy. We don't have a one and done transaction. We live with these engines from delivery for 20 or 30 years. And that is what I think enables us to make sure that whether it's a shop visit they need completed in the next 90 days or working with them with respect to delivering on their skylines. We're in a position to make sure we understand their needs and then turn around and do everything we can. In 2026, the year of what we call being, being more customer driven. Competition will do what competition does, but we're far more focused on our customers today.

[Guy Johnson]

Okay. Competition may get tougher. I'm taking away from that. But you think you've got, you've got a handle on it. Is that, is that the right interpretation?

[Larry Culp]

I'll let you and others talk about where our competitors are.

[Guy Johnson]

Okay.

[Larry Culp]

I think in terms of the way our senior team and our board are oriented, let's be focused on the customer.

[Guy Johnson]

Okay.

[Larry Culp]

Customer will, will lead the way.

[Guy Johnson]

President Xi is coming in September to the United States. Should I expect big GE orders?

[Larry Culp]

Well, we were very pleased with the news we had in Beijing when both Kelly Ortberg from Boeing and I were there, honored to be there with the President. I think the foundation was, was laid. The door is open and it'll be a good bit of work.

[Guy Johnson]

There was an expectation that maybe that that trip would have delivered more. Is it a kind of, is it a two part story? Part one we've seen. Part two comes in September.

[Larry Culp]

I think it's a journey. And there was an important step taken in Beijing, no doubt in my mind.

[Guy Johnson]

Okay, final quick question. We're almost done with the current generation of engines. We are going to be moving on to the next generation of engines, which you see as being an open rotor kind of configuration, huge blades at the front of the engine. Many of the airline CEOs that I talk to at the moment say just, let's just fix what we've got right now and make sure it works properly. What we want is reliability. What's the, what do you say to that in terms of what this next generation of aircraft engines will actually deliver?

[Larry Culp]

We couldn't agree more. Right, here we are in 2026. Our Leaf engine is still a relatively new engine. Our GenX, our leading widebody engine, still relatively new. Our GE90, really the workhorse in the widebody space. Probably a teenager, not a mature adult. So these are engines that are going to fly for decades and we are working to improve the durability and reliability of those engines. That said, we need to be investing in 2026 to be ready for that next generation narrow body that may be 10 or 15 years out from where we are today. We're not investing today. We're not ready. Then we do think that the open fan architecture will allow us to address those reliability and durability concerns as well as deliver the next breakthrough in efficiency and sustainability.

[Guy Johnson]

So it becomes simpler, not more complicated.

[Larry Culp]

Exactly. And that's, that's the technology breakthrough that allows us to do both. As my friend Jim Collins would say, to employ the genius of the. And durability and efficiency.

[Guy Johnson]

Larry, it's great to see. Thank you very much indeed for spending some time with us this morning. Guys, back to you in the studio. Larry Cole, the CEO of GE Aerospace.

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