Siemens move to allay fears over job cuts

MUNICH — The chief executive of German conglomerate Siemens said up to 11 600 jobs could be at risk in a restructuring plan he unveiled earlier this month that aims to save the company €1bn annually.Joe Kaeser, who was vaulted into the top job at the Munich-based firm nine months ago, is cutting the organisation back to nine core divisions. Previously Siemens had been structured along sectoral and regional lines.

At an investor conference in New York on Thursday, he was asked for more details on his savings plans and responded by attaching specific job numbers to the scheme for the first time.

“We do away with the four sectors. 7 600 people work in sector co-ordination, co-ordinating a middle layer that is gone. Another 4 000 people were doing a regional cluster analysis, which is not necessary anymore,” Kaeser said.

Responding to queries about the numbers on Friday, a Siemens spokesperson said that not all of the employees mentioned by Kaeser would end up losing their jobs. He noted the company’s previous savings plan, launched in 2012, had involved 15 000 positions but had resulted in an overall headcount reduction of 4 000.

Siemens employees are 360 000 worldwide, with about a third in Germany.

“For now, Mr Kaeser has only said how many positions are affected by the organisational restructuring,” the spokesperson said by email. “But removing jobs in one area does not necessarily have to mean job cuts.”

Kaeser’s predecessor Peter Loescher ran into trouble with unions when he tried to push for job cuts. He was pushed out last summer after a series of profit warnings.

Kaeser has vowed to restore a sense of pride at Siemens, which traces its roots back to an electrical telegraph company founded in Berlin in 1847.

He will be keen to avoid a showdown over job cuts that might distract from his ambitious corporate overhaul, dubbed “Vision 2020”, and from separate plans to bid for the power assets of French rival Alstom, which is already the target of an offer from US giant General Electric.

“The number that is circulating has not been discussed with us,” a spokesperson for the IG Metall union, which represents engineering workers, said on Friday. “We are waiting for the talks.” — Reuters.