Siemens to axe 15,000 jobs in cost-cutting bid
A third of the cuts will come in the firm’s German home market, said Siemens spokesman Oliver Santen.
He declined to specify which other regions will be affected by the plan. Siemens has some 370,000 employees.
Former CEO Peter Loescher lost his job after a Jul 25 announcement that the Munich-based company would not meet a goal of profit representing 12% of sales next year. The target, which involved €6.3bn in savings, was part of an effort to catch up with more profitable competitors including General Electric Co and ABB Ltd.
In Germany, some 2,000 employees at the industry division, 1,400 energy sector workers and 1,400 in the infrastructure and cities unit will have to leave, Santen said. Another 200 admin roles will also be terminated by the end of Sept 2014.
The company had initially planned some 8,000 job cuts globally, a source said.
“If you see a billion euros in charges this year, that pretty much lines up with 15,000 job cuts,” London- based JPMorgan Chase & Co analyst Andreas Willi, who rates Siemens shares neutral, said.
“There have been charges in drive technologies, power generation and transmissions, so you expect them to bear the weight.”
About half of the job cuts have been implemented, while the rest are still being negotiated with unions and will include early retirements. Joe Kaeser, who was promoted to lead the company in August after working as chief financial officer for seven years, is working to regain investor confidence after five profit warnings and a 22% stock decline in his predecessor Loescher’s six- year tenure.
While still chief financial officer, Kaeser said he expected to complete sales of units including airport luggage systems, mail automation and water technology in the fiscal year starting tomorrow.
The divestments follow the spinning off of the Osram Licht lighting unit and the sale of a 50% stake in Nokia Siemens Networks.
Siemens had a profit margin of 9.5% in 2012, while ABB Ltd and General Electric Co had margins of 10.3% and 15%.
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