Siemens Deepens Revamp as Wind-Energy Drought Forces Job Cuts

August 27, 2012 by  
Filed under Green Energy News

Siemens AG (SIE) intensified a push to
lower costs and announced 500 job cuts at the business making
mechanical drives, saying that continued slack demand for wind-
energy components necessitates a streamlined organization.

Siemens will implement the cuts by 2016 and will bundle
some production sites that previously operated separately, the
Munich-based company said today in a statement. The job cuts
will occur at six German factories making industrial gear boxes
and clutches, and Siemens said it’s seeking the reductions via
measures such as attrition, early retirement and fluctuations.

“The reason for the changes is the lasting weakness in
demand for wind mills, which should be compensated by demand for
drives from other industries in the long term,” Siemens said in
a statement today.

The cuts add to thousands of reductions that Siemens has
announced so far this year at businesses ranging from medical
technology to transformers and lighting. Chief Executive Peter Loescher has cut his profit target once this year and said last
month that the lower goal will also be a stretch as demand
dwindles from China and Europe grapples with the debt crisis.

Loescher said on July 26 that he will focus on additional
cost reductions by slashing procurement expenses, improving
product design and project execution under a program that he
will make public after a management meeting in October.

Siemens bolstered the industrial drive business in 2005,
with the purchase of Flender Holding GmbH from Citigroup Inc. (C)
for 1.2 billion euros ($1.5 billion). Siemens is among the
world’s largest maker of windmills to generate electricity, and
is in the process of building wind parks off the German coast as
the country seeks to generate more power from renewable sources.

To contact the reporter on this story:
Richard Weiss in Frankfurt at
rweiss5@bloomberg.net

To contact the editor responsible for this story:
Benedikt Kammel at
bkammel@bloomberg.net

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