Siemens to Cut 7,000 Jobs in Enterprise Communications

Siemens AG is to cut 7,000 jobs at its corporate telecommunications unit Siemens Enterprise Networks (SEN), officials with knowledge of the plans told the Associated Press on Monday.

The cuts would amount to about 40 percent of the telecom unit’s worldwide work force of 17,500 people.

Channel Marketing Manager David Dyer said that the UK operation was one of the most successful operations in SEN. Other sources at Siemens told Comms Business Magazine that there would be an official press announcement later today.

AP report that SEN designs large-scale communications systems for corporations, but has come under pressure from the availability of cheaper Internet-based telephone systems which has eaten away at its customer base and sales.

The Munich-based company intends to announce the cuts today after a meeting of its economic advisory committee, according to the officials who asked not to be identified by name because the official announcement had not yet been made.

Siemens, whose diverse products include trams, turbines and telecommunications equipment, will eliminate 4,000 jobs in the unit worldwide with 2,000 of those cuts coming in Germany, its home market, according to the officials. Another 3,000 workers, including 1,000 in Germany, will be shifted to other units owned by Siemens or to company partners, they said.

Shares of Siemens rose 1.2 percent to close at 88.70 euros ($131.56) in trading Monday in Frankfurt.

The move is part of chief executive Peter Loescher’s efforts to reorganize and streamline the conglomerate, which has been wracked by allegations of bribery and fraud.

One of Loescher’s goals saw him reorganise Siemens’ corporate structure into three units — health care, automation and infrastructure, and energy.

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