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Siemens to Cut 1,400 Jobs to meet targets

Discussion in 'Market Predictions and Reports' started by godoftrading, Jul 22, 2009.

  1. godoftrading

    godoftrading Private, 1st Class

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    July 22 (Bloomberg) -- Siemens AG plans to cut more than 1,400 jobs as the German maker of building controls, trains and turbines strives to meet profit targets for the year.

    A unit manufacturing controls for office blocks and buildings is seeking to eliminate 300 posts at sites in Germany, the U.K., Switzerland and Sweden, according to company spokesman Marc Langendorf.

    Chief Executive Officer Peter Loescher is digging deeper to beat last year’s 6.6 billion euros ($9.4 billion) in sector profit, or earnings from main businesses. Loescher’s aim to raise profitability to the level of competitors has coincided with a global recession that’s hurting orders. A year ago, Siemens announced 17,000 job cuts, and 19,000 workers are currently on reduced hours.

    “Shorter work weeks are simply not enough,” said Heinz Steffen, an analyst at Fairesearch in Frankfurt. “After the elections in Germany we will see massive jobs cuts, both at Siemens and elsewhere. Companies will wait to announce these measures for political reasons.”

    Under the latest round of cuts, an Austrian unit involved in software development could lose 630 positions. Siemens VAI Metal Technologies, also in Austria, stands to lose 200 jobs, with a further 300 posts earmarked for elimination at a British information technology services business, Langendorf said. Negotiations with workers’ councils at all four units involved are under way.

    The German company faces missing margin targets at several units in the current fiscal year, said Theo Kitz, an analyst at Merck Finck & Co. in Munich.

    “In some areas, Siemens might have to reduce costs further in order to reach them” next year, the analyst added.

    Siemens to Cut 1,400 More Jobs to Hit Margin Targets (Update1) - Bloomberg.com

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