Siemens drives industrial transformation through €1bn investment

Posted on 16 Mar 2016 by Aiden Burgess

Investment set to create 25,000 new jobs a year

Siemens has announced that it expects to hire at least 25,000 new employees worldwide each year as part of a €1bn investment into research and development.

As a part of the investment, Siemens is planning to take on at least 25,000 people worldwide per year in the “years ahead”, including around 3,000 new hires per year in Germany.

The €1bn (£790m, US$1.11bn, AUD$1.49bn) investment by Siemens into its research and development division will also help in the areas of productivity and global sales. The investment is also set to form part of Siemens ‘realignment’ and expansion from a traditional manufacturer into a digital industrial company.

The German company said it believes its industrial transformation is necessary if it wants to remain competitive in an ever changing digital market, particularly in increasingly competitive sectors including oil and gas, metals and mining.

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Creation of new Siemens business units

The transformation into a digital industrial company has involved the realignment of the company’s Process Industries and Drives division into two business units; Large Drives and Process Solutions.

While new jobs are set to be created, Siemens has announced that its realignment will result in 2,500 job losses worldwide in its oil, gas and mining units due to increasing demand for large processing equipment, as the low global oil price has meant oil firms are not willing to invest in new equipment at such a volatile time.

About 2,000 of the jobs will be lost in Germany.

The main goal of Siemens’ planned measures is to consolidate the activities and optimise the size of manufacturing locations in Europe in order to improve its competitiveness in a tough market environment.

Dr Juergen Brandes, CEO of the Siemens Process Industries and Drives Division.
Dr Juergen Brandes, CEO of the Siemens Process Industries and Drives Division.

CEO of Siemens’ Process Industries and Drives Division, Jürgen Brandes, said the volatile nature of the raw materials market meant the company had to adapt through changing its focus.

“Plunging demand in raw materials markets has led to a significant intensification of competition, particularly in Asia,” he said.

“To guarantee our competitiveness, we’ve got to adapt to these conditions. That’s why we’ve got to optimize our manufacturing network worldwide and reduce the number of facilities producing similar or identical products. We’ve also got to increase the global competitiveness of engineering at our Process Solutions Business Unit.”

Siemens generated revenue of €75.6bn and net income of €7.4bn during the 2015 fiscal year which ended on September 30, 2015. Siemens had around 348,000 employees worldwide at the end of September 2015.

Want to undertake a digital transformation at your business? Then don’t miss The Manufacturer’s Smart Factory Expo, taking place as a part of The Manufacturer Live events on the 9th & 10th of November 2016 at The International Centre Telford.