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Siemens lays off 2,400 staff in €1.5bn savings drive
Expect more to come...

By Jo Best

Published: Monday 19 September 2005

Siemens has announced sweeping job cuts across three of its divisions in an effort to cut operating costs by €1.5bn.

Reports surfaced last week that Siemens was to make sweeping job cuts, with a figure of 10,000 layoffs being mentioned.

However, Siemens CEO Klaus Kleinfeld confirmed in a conference call today the number of job cuts will be 2,400 from the company's Business Services (SBS) division in Germany, while its Logistics and Assembly and Communications units will also be reorganised.

Further job cuts in Siemens' Communications division will follow, although no official figure was released today.

Kleinfeld described the layoffs, which will take place over the next two years, as "unavoidable" and added: "We are not making a mistake, I think what we are really doing is continuing to increase value for SBS."

Siemens will also be rejigging its management team to keep the cost-cutting programme on track. Dr Christoph Kollatz will take over as SBS' CEO, replacing Dr Adrian von Hammerstein, while current SBS CFO Bernd Regendantz will be replaced by Michael Schulz-Drost.

As part of the changes at Siemens, the Enterprise Networks division - part of the communications unit - will turn its attention to wooing corporate customers as it has found small and medium-sized businesses are still shy of investing in technologies such as VoIP.