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Speaker 1: GE Chairman and chief executive officer Larry Colp says the

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Speaker 1: company's aerospace business could eventually see annual revenue soar above

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Speaker 1: forty billion dollars. In an exclusive conversation with host David Weston,

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Speaker 1: Colp discusses how air travels post pandemic rebound is good

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Speaker 1: news for GE.

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Speaker 2: We couldn't be in a better position with respect to

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Speaker 2: the post pandemic recovery in aerospace. You've seen the performance

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Speaker 2: thus far this year. We're really on a record pace

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Speaker 2: given both the return to flight really around the world

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Speaker 2: now is people get out and see people see places

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Speaker 2: they haven't been to, and at the same time they're

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Speaker 2: looking to modernize and expand their fleets. So we have

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Speaker 2: tremendous backlogs with our major airframers Boeing Airbus for example,

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Speaker 2: the supply chain challenges are significant and right alongside everything

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Speaker 2: we're doing on the commercial side. We've seen a really

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Speaker 2: strong uptick in our defense business is one would imagine

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Speaker 2: both with fixed wing and rotary. So in terms of

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Speaker 2: how big this business can be, we're I think on

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Speaker 2: a path where we could be growing in the mid

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Speaker 2: single digit, high single digit range for some time. That

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Speaker 2: would put us well north of forty billion dollars in

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Speaker 2: but a few years. A lot of opportunity we have

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Speaker 2: I think an ambable position in propulsion. But again, it's

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Speaker 2: not about how big we get. It's about how strong

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Speaker 2: we are and are we serving our customers? Are we

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Speaker 2: taking care of our team? Are we doing well by

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Speaker 2: way of our shareholders?

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Speaker 3: As you say, Lar, you're not going to get ahead

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Speaker 3: of the board of ge Airspace when you get to

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Speaker 3: wise to do that. What's on the table As the

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Speaker 3: point you've spent your five years really redoing the balance sheet,

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Speaker 3: really fixing the cash flow situation, retiring a lot of debt.

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Speaker 3: Capital allocation maybe hasn't been so much of an issue

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Speaker 3: because you're just trying to retire to that debt. Going forward,

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Speaker 3: you may well have some capital to work with. So

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Speaker 3: what are the possibilities, both in terms of acquisitions but

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Speaker 3: also sail potentially well.

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Speaker 2: I think that we want to be wise stewards of

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Speaker 2: that capital, right. I've long believed that investors give you

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Speaker 2: a license to reinvest in your business, and you need

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Speaker 2: to be careful with that license lest it gets pulled.

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Speaker 2: But I think what we've tried to do is set

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Speaker 2: up all three of the businesses to be in a

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Speaker 2: position where they are well capitalized, investment grade and will

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Speaker 2: have the opportunities to think through not only their organic options,

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Speaker 2: be at M and a small mid size probably not

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Speaker 2: something large and headline breaking, but at the same time,

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Speaker 2: how do we think about buybacks, how do we think

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Speaker 2: about dividends? So I think you'll see each of the

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Speaker 2: three companies, once we spend Giev Vernova sometime early next year,

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Speaker 2: be in a position where they'll have tailored, balanced capital

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Speaker 2: allocation policies that will be in effect. Confident all three

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Speaker 2: boards will carry forward that responsibility.

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Speaker 3: Well, you mentioned Vernovo. Let's turn to power. Renewals have

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Speaker 3: been a challenge for just about everybody at this point,

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Speaker 3: including for GEO. Though you think you're going to get

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Speaker 3: toward profitability before the spinoffice, I understand it, Yes, what

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Speaker 3: are the challenges? What is the potential for profitability out

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Speaker 3: of that renewables business?

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Speaker 2: Well, we've made a lot of progress, David in our

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Speaker 2: ge power businesses the last several years. That's really been

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Speaker 2: I think ground zero with respect to the improvements that

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Speaker 2: we have made in Vernova and ge at large, and

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Speaker 2: we're really running the power playbook in our renewables businesses,

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Speaker 2: principally in on shore wind, which is I think the

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Speaker 2: battleground today. We think that can be a high single

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Speaker 2: digit operating margin business in time. Everything that we've talked

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Speaker 2: about over the last four quarters in terms of the

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Speaker 2: nature of that turnaround has really played out, both in

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Speaker 2: terms of our field performance, are cost reduction efforts and

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Speaker 2: just the day to day rhythms in the business. I

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Speaker 2: was with them just a couple of weeks ago, and

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Speaker 2: I'm really encouraged by what we're seeing. The Inflation Reduction

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Speaker 2: Act has driven a lot of demand not only in

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Speaker 2: our and our offshore wind businesses, but also in our

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Speaker 2: grid automation businesses.

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Speaker 1: That's GE chairman and CEO Larry Colp speaking with host

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Speaker 1: David Weston. You can hear this full conversation on Friday

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Speaker 1: night on Bloomberg Wall Street Week that starts at six

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Speaker 1: pm Eastern on Bloomberg TV and Radio.