Siemens to cut 7,000 jobs at unit
( AP ) - Industrial conglomerate Siemens AG will cut 7,000 jobs at its corporate telecommunications unit Siemens Enterprise Networks, 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.
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 Tuesday after a meeting of its economic advisory committee, according to the officials who asked not to be indetified by name because the official announcement had noy yet been made.
The Sueddeutsche Zeitung newspaper reported the planned cuts on Sunday.
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 reorganize Siemens' corporate structure into three units - health care, automation and infrastructure, and energy.