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Siemens to cut 6,900 jobs in power and gas division
Siemens is to cut 6,900 jobs worldwide, half of them in Germany, due to what it says is the ‘rapidly accelerating structural changes in the fossil power generation market and the commodity sector’.
The company said in a press statement that it would be consolidating its global setup, while looking to increase investments in future growth markets. It says that a consolidation plan for its Power and Gas Division, its Power Generation Services Division and its Process Industries and Drives Division will increase capacity utilisation at production facilities, drive efficiency and enhance expertise by bundling resources
‘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,’ said Lisa Davis, member of the Managing Board of Siemens AG.
‘[The] action follows a nearly three-year effort to right-size the business for this changing marketplace,’ she said. ‘Our plan is to execute these changes in a fast and prudent manner while also investing in future-oriented technologies.’
Janina Kugel, Chief Human Resources Officer and member of the Managing Board of Siemens AG said: ‘The cuts are necessary to ensure that our expertise in power plant technology, generators and large electrical motors stays competitive over the long term. That’s the goal behind the measures we're taking.’
Around 6,100 of the job cuts will be made before 2020 at the Power and Gas Division. Siemens says that global demand for large gas turbines (larger than 100 MW) has fallen drastically, and is expected to level out at around 110 turbines a year. This contrasts with the manufacturing capacity of all turbine producers worldwide of around 400 turbines.
Since it started investing in more efficient turbines and more efficient processes to build them three years ago, the scope and speed of market changes have increased significantly, along with competition, says Siemens.
Siemens’ Görlitz factory in Germany, currently supporting around 720 jobs, will be closed, as well as its Leipzig location – around 200 jobs.
The company says that it is investing in growth markets and in 2017 hired around 39,000 people worldwide, including about 5,200 in Germany, with the number of employees in Germany rising slightly year-on-year from 113,000 to 115,000. Investments in R&D and production facilities are to be increased significantly in 2018, it says.
For more on skills and jobs in the energy industry see page 28 onwards.
