Unions protest Siemens job cuts

Despite a headline rise in profits in the last quarter of 2017, the German industrial giant Siemens reiterated plans to go ahead with job cuts at its power and gas business, which saw a 49-percent drop in operating profit to €238 million ($296 million) from €471 million in the period.

Discussions with workers' councils and unions taking place in Munich at the company's headquarters on Wednesday, are focusing on the affected locations and a general restructuring of the company's power and gas business.

Generally healthy

Siemens said on Wednesday that its net income rose 12 percent to €2.2 billion in the last three months of 2017, helped by a one-off gain from the sale of shares in its Osram lighting business and from the US corporate tax cut.

The company's tax bill fell by €437 million ($544 million) after refiguring tax liabilities under the recent US corporate tax cut, which reduced the rate from 35 percent to 21 percent. The company said results for the quarter had also benefitted from the upswing in the global economy.

"This underlines the strength of our company," CEO Joe Kaeser (pictured above) said, adding that he expected "the macroeconomic environment to remain positive." On the downside, he cited geopolitical risks such as tensions on the Korean peninsula, as well as "diverging definitions of free and fair trade."

Revenue rose 3 percent to €19.8 billion ($24.6 billion) while orders increased 14 percent to €22.5 billion. The company's order book was boosted by a €900 million order for commuter trains in Israel including servicing.

Profits in the mobility division rose also as the company filled large orders for trains in Europe in the US, including the entry into service of new high-speed trains in Germany.

Siemens products include trains, factory software, medical imaging machines and power turbines.

Industrial unrest

Siemens said in late 2017 it was cutting about 6,900 jobs, 2 percent of its global workforce, mainly at its power and gas division.

Most of the cuts, about 6,100, will be made before 2020 at Siemens's Power and Gas division, which has been overtaken by the growth in solar and wind capacity.

Siemens' Process Industries and Drives division, which makes large mechanical drives for oil and gas extraction and turbines, will also be hit, Siemens said.

Siemens said roughly half of the job cuts would be made in Germany.

The company employs about 16,000 people in power generation in Germany, roughly a third of its global workforce in that business, including service.

Janina Kugel, head of human resources at the German industrial equipment maker Siemens, told German news agency DPA on Wednesday that the company expected to arrive at an agreement with the unions over planned cuts.

"Happily, both rounds of exploratory talks have so far been matter-of-fact and constructive," she said.

Around 300 workers are expected to take part in a protest at Munich's Olympic Hall, where the shareholders' meeting is taking place on Wednesday, the IG Metall union said.

jbh/hg (dpa, AP)