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Business

Siemens to slash thousands of jobs

German engineering giant Siemens has said it plans to axe 11,600 jobs in a bid to streamline operations and cut about 1 billion euros ($1.34 billion) in costs.

Siemens restructures

Siemens CEO Joe Kaeser has said the German engineering heavyweight will phase out at least 11,600 jobs in a drive to become more profitable and catch up with rivals.

Speaking in a webcast conference from New York earlier in the week and reported by Bloomberg on Friday, Kaeser said 7,600 positions will be cut as his company strives to be more efficient and an additional 4,000 people who work in redundant jobs at regional clusterings will also be laid off.

He said the new structure will help Siemens cut about 1 billion Euros in costs by the end of 2016.

Some of the employees will be assigned other roles. The planned cuts represent about 3 percent of Siemen’s workforce.

"A certain amount of people do stuff for co-ordinating things, analyzing things," Bloomberg quoted Kaeser as saying. "About 20 percent of those we believe can be put to work elsewhere, but not there. They can be taken out of the system because the work goes away."

Reports in German media cited an unnamed Siemens spokesman who suggested the job losses were still not a done deal.

"Mr. Kaeser only said how many jobs are affected by the restructuring at Siemens," the spokesman was quoted as saying. "But cutting positions in one sector doesn’t necessarily mean job losses."

Major overhaul

In early May the German electronics and engineering powerhouse unveiled a restructuring plan dubbed "Vision 2020" aimed at trimming operations and boosting performance and profitability.

That plan included selling divisions that are not part of the company’s core business and publicly listing its hearing aid business and focusing more on electrification, automation and digitalization.

Previously Siemen's chief financial officer, Kaeser announced a company review soon after accepting the top job in August.

Siemens is also bidding for the energy division of France's Alstom and faces tough competition from US rival General Electric.

The German company has now proposed swapping its trainmaking business for Alstom’s energy assets to create two European companies in rail and energy.

sp/cjc (Reuters, dpa)

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