Add us to your taskbar by dragging this icon RGI logo to the bottom of your screen.

Close

Siemens Mobility hit by competition and industry overcapacity

11 May 2017

SIEMENS: Plans for a restructuring of various activities in Germany were announced by Siemens on May 11, as part of strategy to become a ‘digital industry company’ and reduce costs. The measures included centralisation of IT and training activities, and the loss of around 1 700 jobs over several years including 300 at the Mobility Division’s Krefeld plant. Another 1 000 jobs across the company will be transferred internally or externally.

Siemens said the Mobility Division had recently reported ‘solid profit figures’, but its Mainline Transport and Urban Transport units were struggling with increasing competition and rising cost pressure, while the ‘aggressive globalisation strategy’ of ‘the largest Chinese competitor’ and overcapacity in the market had led to a substantial decline in prices. In addition, many infrastructure projects around the world are being postponed as a result of public sector spending cuts.

Siemens said competitiveness would only be achieved through economies of scale and rigorous cost management.

‘The greatly increased competitive intensity in the worldwide rail business has consequences for us’, said Mobility Division CEO Jochen Eickholt. ‘To survive in this environment, we have to take action now.’