Major Cost-Cutting Drive at Siemens AG

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Major Cost-Cutting Drive at Siemens AG

Siemens AG has announced that the largest engineering company in Europe will cut 15,000 jobs under cost-cutting program. Siemens will cut 5000 jobs in Germany and over 10,000 all over the world. Siemens has been facing lower profits and the company has issued two profit warnings in last fiscal.

Siemens currently employs more than 370,000 employees worldwide and 119,000 in Germany. The company axed chief executive officer Peter Loescher two months back. Joe Kaeser took control as CEO in July this year. Siemens informed that the company has reached agreement with union about half of the job cuts. The company is confident to reach a deal for rest of the job cuts as well.

The company has not yet started with the job cuts but the plan will be implemented by end of 2014. The company aims to save nearly $8 billion with cost-cutting drive. The stock has suffered as the company released profit warnings twice.

Siemens announced third quarter results as well. The company reported 43 percent rise in net profit at $1.1 billion euro. The company recently shifted operations of lighting major Osram as separate unit.


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