Siemens Faces Major Restructuring, Job Cuts

According to German newspaper Deutsche Welle, the head of German engineering group Siemens has confirmed that a major restructuring is in the works, after media reports said the firm wanted to lay off 17,000 workers.

Referring to the state of the world economy and the rising oil price, Siemens Chief Executive Peter Loescher said it was time for Germany's biggest engineering company to act. Loescher said Siemens needed to reach a target saving of 1.2 billion euros (1.9 billion dollars) by 2010 to remain competitive.

It was reported that Siemens planned to cut more than 17,000 jobs from its 400,000 global workforce, including some 6,450 jobs in Germany. The amount -- nearly four percent of the workforce -- was considerably more than the 10,000 anticipated by trade union IG Metall as part of a broad revamp of the company's operations.

The scale of the cuts, which are expected to mainly affect administrative positions, is unprecedented in the 160-year history of the German company. According to the Sueddeutsche Zeitung, the German cuts would be spread over two years and are due to be announced officially in the fall.

Source: Deutsche Welle