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Siemens plans to cut 12,600 jobs
By siliconindia
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Thursday, 10 July 2008, 02:43 IST
Germany: In order to strengthen the operation and counter the economic downturn, the Euroap's Siemens is planning a restructuring program. As an initial move Siemens is looking to cut 12,600 jobs globally mainly in administration to meet its 1.2 billion euros ($ 1.9) saving goal by 2010. It also has plans to eliminate another 4,150 jobs through this program.
Siemens shares have fallen almost 35 percent so far this year. By comparison, U.S. rival General Electric has lost 27.4 percent and Dutch competitor Philips has lost 28.8 percent, according to Reuters data.
Peter Loescher, Chief Executive, Siemens who has taken charge a year back said that Siemens needed to be faster, more efficient and have a leaner administration if it hoped to keep up with rivals. "This takes on special urgency when one considers the economic downturn," he said.
Loscher's far-reaching move to improve efficiency at Siemens, which employs 430,000 people in 190 countries, follows a string of job cuts recently in Germany, with companies such as BMW, Continental and Henkal slashing thousands of jobs to regain competitiveness. Henkel, the consumer goods company, on Tuesday announced it would reduce its German workforce by 1,000 as part of a worldwide retrenchment program. It said this was a reaction to higher energy costs, rising oil prices and a weakening consumer demand.
However the labor representatives are not in a position to welcome the move to cut the jobs, Engineering trade union IG Metall condemned the plans and did not rule out taking measures in protest. They planned to resist but would first wait for the outcome of negotiations with management.
Neugebauer, Head, IG Metall, Siemens, Bavaria said that Siemens is looking good economically, the order books are full. That makes the planned job cuts neither comprehensible nor acceptable.
The reason behind the elimination of employees is according to Siemens is to reduce the general and administrative charges within two years.
