Industry unit takes brunt of Siemens jobs cull
Europe's biggest engineering group plans radical job cuts
German industrial conglomerate Siemens plans to cut around 4 per cent of its workforce worldwide, mainly in its industrial unit, as part of a major overhaul.
Siemens wants to cut 16,750 jobs globally, of which 12,600 are mainly in administration, to help Europe's biggest engineering group reach a savings target of €1.2bn by 2010 and boost profit margin levels.
Chief executive Peter Loescher, who has extensively restructured Siemens since taking charge a year ago, said the group needed to become faster and more efficient to catch up with the competition.
So far, he has regrouped the company's units into three main divisions aligned with global growth trends: infrastructure and industry, energy, and medical technology. He has also scaled down the management board to eight from 11 posts.
Loescher said Siemens would cut 6,350 jobs at its industry unit, 3,950 at energy, and 2,800 at healthcare.
Negotiations with staff representatives about the planned job reductions will begin quickly, Loescher said. The company employees a total of about 400,000 people
However, the German engineering trade union, IG Metall, condemned the plans and did not rule out taking measures in protest.
"Siemens is looking good economically, the order books are full ... That makes the planned job cuts neither comprehensible nor acceptable, and they are excessive in extent," said Werner Neugebauer, head of IG Metall.
The rationalisation comes as Siemens struggles to put an end to a worldwide investigation into a corruption and bribery scandal and as it hopes to regain investor confidence after a profit warning in March that sent its shares tumbling.