Siemens to axe 12,600 jobs

Around 12,600 Siemens staff will lose their jobs as a result of the company's transformation

Siemens is cutting 12,600 jobs across its global operations, as part of its business transformation programme.

Most will be administration-related positions, but an additional 4,150 jobs will be affected by restructuring projects.

Difficult economic conditions have driven the efficiency agenda, said Peter Löscher, president and chief executive of Siemens.

“The speed at which business is changing worldwide has increased considerably, and we’re orienting Siemens accordingly," he said.

"Against the backdrop of a slowing economy, we have to become more efficient. "

Siemens announced in November that it planned to reduce sales, general and administrative costs to a "competitive level."

The supplier now plans to reduce costs in absolute terms by €1.2bn (£950m) by 2010, amid the global economic downturn. Cuts in expenditures for IT infrastructure will help the company to meet this goal.

In April, Siemens reported second quarter profits of €2.9bn for the 2008 financial year, down from €3.3bn year-on-year, despite revenue rising from €36.5bn to €38.6bn in the same period.

Siemens IT Solutions and Services, the IT supplier arm of the firm, suffered a €35m loss. The division’s total revenue for the quarter fell slightly to €1.27bn from €1.35bn a year earlier.