German engineering group Siemens, which plans to slash around 17,000 jobs worldwide, will soon be able to specify how much the job cuts will cost, its chief executive said.
Peter Loescher told journalists late on Monday that talks with labor representatives had been constructive. Siemens’ works council is due to meet on Tuesday and Wednesday to approve the plans designed to speed up cost savings and boost margins. “It is our wish to book the major parts of provisions for restructuring this (fiscal) year,” Loescher said in remarks embargoed for release on Tuesday. Costs for job cuts are expected to be in a range of mid-to high triple-digit millions of euros.
Siemens could post a net loss in its Q4, which ends on Sept 30, on account of the provisions and due to the sale of its telecoms unit SEN. But proceeds from the sales of its automotive business VDO are expected to compensate negative impacts for the entire year.
One uncertainty for Siemens remains. The group is being investigated worldwide over suspicious payments to win contracts. Siemens may face fines or even be banned from bidding for public contracts in the United States once the US Securities and Exchange Commission SEC and the US Department of Justice conclude their investigation. “We are in talks,” Loescher said. “But we are not in charge of the process.”
Loescher, who took the helm at Siemens in mid-2007, has promised to slim down the giant company, which makes products ranging from light bulbs and high-speed trains to medical equipment and turbines, so it can catch up with more profitable rivals, such as General Electric. (Reuters)