Siemens to cut 6900 jobs in power-related divisions

• 7 years ago (2017-11-17)
• David Flin

Europe 1088 Gas 393

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Siemens has announced that it will cut 6900 jobs as it responds to what it describes as an “unprecedented” change in the power generation market. This represents about 2 per cent of its global workforce, and the cuts will come mainly from its power and gas division, which has been hit by the rapid growth of renewables.

The company said that the plans were part of a consolidation that will affect it three power-related divisions and will “increase capacity utilisation at production facilities, drive efficiency, and enhance expertise by bundling resources.”

Most of the cuts, around 6100, will be made at Siemens’ Power and Gas Division before 2020. Lisa Davis, member of the Siemens Management Board, said: “The power generation industry is experiencing disruption of unprecedented scope and speed. With their innovative strength and rapidly expanding generation capacity, renewables are putting other forms of power generation under increasing pressure.” Siemens has said that it hasn’t ruled out the possibility of forced layoffs as part of the plan. Siemens also said that roughly half of the job cuts would be made in Germany. It did not specify the costs of the layoffs.

Brigitte Zypries, the German Economy Minister, urged Siemens to treat employees fairly. She said: “The workers are very concerned and uncertain about their future. I hope that Siemens works closely with the unions to find fair solutions for the affected sites.” She said that sites in structurally weak regions should be preserved.

Siemens said that demand for power plant sized gas turbines (generating over 100 MW) has tumbled, and is expected to bottom out at 110 turbines a year, compared with a total global manufacturing capacity of around 400 turbines.

Janina Kugel, Siemens board member with responsibility for group human resources, said: “The market is burning to the ground.”