GE moving corporate headquarters to Boston

Its corporate reputation is tied to producing big, heavy equipment – atoms by the ton, not the ephemeral bits of software.

In a statement, GE’s chief executive Jeff Immelt said, “We want to be at the center of an ecosystem that shares our aspirations”.

U.S. industrial conglomerate General Electric (GE) said Wednesday that it has chose to move its headquarters to Boston, Massachusetts.

A move would be yet another change to a piece of the manufacturer’s identity, following a year that saw the acquisition of Alstom’s power business, the largest deal in the GE’s history; the collapse of a second attempt to sell its appliance division; and the wind-down of much of its sprawling lending business, with agreements to sell $157 billion of its portfolio. It is an opportunity, but also a threat.

Big companies like General Motors and Ford are also retooling to match up the competition from innovators such as Google and Tesla.

“We are excited to bring our headquarters to this dynamic and creative city”, the company said in the press release that announced its move to Boston. “Greater Boston is home to 55 colleges and universities”.

Experts say the departure of up to 800 well-paid GE employees, in addition to the tax revenue vacuum, will likely prove problematic and cause a trickle-down effect to local businesses and charities.

In Fairfield, GE has about 800 employees, a tiny percentage of its 360,000 employees worldwide.

The company considered Atlanta; Austin, Texas, and Nashville, Tennessee, as potential headquarters sites, according to people familiar with the matter. The new office will have about 200 administration workers and 600 “digital industrial product managers, designs and developers”, GE said.

“I don’t think it’s surprising that GE moved here”, said Lori Brock, Osram’s head of corporate innovation in the Americas. Other cities probably proffered similar goodies, meaning the final decision sends a strong signal about both Boston and GE.

GE is pursuing to return to its manufacturing roots, and plans to become a tech company. GE CEO Jeffrey Immelt fanned the flames when he wrote a memo earlier in 2015 complaining about tax changes enacted by the state legislature previous year.

“While we have every reason to believe that some GE jobs will remain, we had hoped that GE’s corporate headquarters would stay in Fairfield County”.

MA and Boston are offering an ample package of incentives.

As part of its proposal to GE, Massachusetts commits to improving transportation within the Seaport District, which is now serviced by the Silver Line bus.

GE said the financial incentives from state and city governments vying for its headquarters were competitive.

“There were a lot of things that could have been done better and if we had to do them over again… but GE said in their article this has been in the planning for three years”, he said, so tax issues “obviously couldn’t be everything”.

In its statement, GE said it began its search with an initial list of 40 locations. The company will hold a public briefing in Boston on February 18th. The company also received $1 million in grants for workforce training, up to $5 million for an innovation center to forge connections between GE, innovators from MA research institutions and the higher education community as well as a joint relocation team to ease the transition for employees moving to Boston.