German conglomerate trying to lower costs amid economic slowdown
SAN FRANCISCO (MarketWatch) -- Siemens AG plans to cut 17,200 jobs as the German engineering conglomerate tries to lower expenses in the face of an economic slowdown, according to a report published Saturday.
According to a report in the online edition of the Wall Street Journal, Siemens, which makes trains, computers, cell phones, and light bulbs among other products, has earmarked 6,400 job reductions in Germany, with the rest coming in other parts of the world. Siemens has roughly 400,000 employees and is active in 190 countries.
Most of the jobs eliminated will be managerial, rather than blue-collar, a departure for the company, which has laid off lower-ranking workers in the past, the newspaper said. The planned cuts are in addition to 6,800 job losses at one of its telecommunications-equipment units, which were announced in February.
Sponsored by:SI) (XE:723610: news, chart, profile) representatives in Germany and the U.S. didn't immediately respond to an email seeking comment on Saturday.
Chief Executive Peter Löscher, who's been running Siemens for a year, has promised to reduce selling and administrative costs by $1.89 billion, or 10%, by 2010 to try to increase profitability to levels of rivals like General Electric (GE
Sponsored by:GE) , the Journal noted.
Löscher hopes to avoid forced layoffs, and affected employees will be offered financial incentives, the newspaper added, citing an unidentified person familiar with the matter.
The plans are to be detailed at a July 7 meeting with worker representatives, and negotiations should begin shortly afterward, the Journal reported.Alistair Barr is a reporter for MarketWatch in San Francisco.