Released February 12, 2015 | GALWAY, IRELAND
en
Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) - German engineering giant Siemens AG (NYSE:SI) (Munich, Germany) has announced 7,800 job cuts in a move that it claimed will bring its aggressive restructuring process to an end.
The company said the cuts - 3,300 of which will be in Germany - will streamline its "administrative and overhead functions". It will also save about 1 billion ($1.13 billion) which will be "invested in innovation, productivity and growth initiatives", the company stated. The cuts represent around 2% of Siemens' global workforce of 343,000.
"This completes the restructuring of our company in line with the new organisational setup of October 1, 2014," said Joe Kaeser, President and CEO of Siemens AG. "Our Vision 2020 concept will enable us to get our company back on a sustainable growth path and close the profitability gap to our competitors. Our strategic reorientation has enabled us to considerably streamline our organization and remove entire intermediate levels. These steps will bring our businesses closer to our customers and make us significantly faster. As a result, certain tasks and functions will be completely eliminated. We're going to tackle this challenge together and implement the resulting measures responsibly."
Last month, Siemens failed to hit its financial targets for the first quarter. Profit from its industrial businesses was 1.82 billion ($2 billion) for Q1, down 4% from a year earlier. Within that, profits from its power and gas division dived 39%, which the company put down to price pressures for turbines. Its healthcare profits dropped 13% on weak orders in Asia.
In June 2013, Siemens pulled the plug on its solar power business following reports that the business had lost almost 784 million ($1 billion) in the previous two years. For additional information, see June 20, 2013, article - Siemens Shuts Down Solar Business.
Siemens has been actively restructuring for the past few years but things accelerated last year when previous CEO, Peter Loescher, was ousted in a boardroom coup.
Despite a major overhaul of business divisions and cost-cutting, the company agreed to spend $7.6 billion to purchase U.S. oilfield equipment company Dresser-Rand Group (NYSE:DRC) (Houston, Texas) last September, just before oil prices started a steep decline. For additional information, see September 25, 2014, article - Siemens Acquires Dresser-Rand Group for $7.6 Billion to Increase Oil-Gas Business.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and nine international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. To contact an office in your area, visit the Industrial Info "Contact Us" page.
The company said the cuts - 3,300 of which will be in Germany - will streamline its "administrative and overhead functions". It will also save about 1 billion ($1.13 billion) which will be "invested in innovation, productivity and growth initiatives", the company stated. The cuts represent around 2% of Siemens' global workforce of 343,000.
"This completes the restructuring of our company in line with the new organisational setup of October 1, 2014," said Joe Kaeser, President and CEO of Siemens AG. "Our Vision 2020 concept will enable us to get our company back on a sustainable growth path and close the profitability gap to our competitors. Our strategic reorientation has enabled us to considerably streamline our organization and remove entire intermediate levels. These steps will bring our businesses closer to our customers and make us significantly faster. As a result, certain tasks and functions will be completely eliminated. We're going to tackle this challenge together and implement the resulting measures responsibly."
Last month, Siemens failed to hit its financial targets for the first quarter. Profit from its industrial businesses was 1.82 billion ($2 billion) for Q1, down 4% from a year earlier. Within that, profits from its power and gas division dived 39%, which the company put down to price pressures for turbines. Its healthcare profits dropped 13% on weak orders in Asia.
In June 2013, Siemens pulled the plug on its solar power business following reports that the business had lost almost 784 million ($1 billion) in the previous two years. For additional information, see June 20, 2013, article - Siemens Shuts Down Solar Business.
Siemens has been actively restructuring for the past few years but things accelerated last year when previous CEO, Peter Loescher, was ousted in a boardroom coup.
Despite a major overhaul of business divisions and cost-cutting, the company agreed to spend $7.6 billion to purchase U.S. oilfield equipment company Dresser-Rand Group (NYSE:DRC) (Houston, Texas) last September, just before oil prices started a steep decline. For additional information, see September 25, 2014, article - Siemens Acquires Dresser-Rand Group for $7.6 Billion to Increase Oil-Gas Business.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and nine international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. To contact an office in your area, visit the Industrial Info "Contact Us" page.
