Original title: Siemens' 10000 layoffs' plan continues: oil, gas and power group will cut 2700 jobs worldwide
German industrial giant Siemens is downsizing its workforce.
On June 18, Siemens announced that it plans to cut 2700 jobs in the oil, gas and power group (GP) worldwide in the next few years, including 1400 in Germany.
This number of layoffs accounts for about 4% of the 64000 employees of the business group worldwide.
This is part of Siemens' 10000 layoffs' plan. On May 7, Siemens announced that it would spin off the oil, gas and power group with a history of more than 150 years. Due to this business adjustment, Ximen plans to lay off 10400 people worldwide by 2023.
The huge industrial giant hopes to save 2.2 billion euros in costs through the plan.
Oil, gas and power group is the largest business unit of Siemens, which was once an important profit support. However, since the second half of 2014, the global oil price has plummeted, the natural gas price has fallen and there is excess supply, and the performance of the group has encountered difficulties.
Siemens said that the oil, gas and power group needs to save 500 million euros in costs to improve its competitiveness. Among them, the restructuring will save 200 million euros, reduce management support, save 200 million euros, and reduce expenditure of 100 million euros for the new structure.
Next, Siemens will negotiate layoffs with employee representatives.
Last September, Siemens announced 2900 layoffs in Germany due to the adjustment of production line capacity and production framework. Earlier in 2015-2017, Siemens also released several layoff plans.
Gas turbine business is the core business of Siemens oil, gas and power group.
Gas turbine is known as the 'Pearl' on the industrial crown. Siemens, General Electric (GE) and Mitsubishi Hitachi Power System (MHPs, hereinafter referred to as Mitsubishi Hitachi) have formed a tripartite situation in the world.
According to McCoy power reports, Ge ranked first in the world in the number of orders for gas turbines in 2018, followed by Mitsubishi Hitachi and Siemens.
In terms of market capacity, Ge occupies 33% of the global market share; Mitsubishi Hitachi benefits from J series gas turbines, accounting for 31% of the market share; Siemens accounts for 26%.
Since 2010, Ge gas turbine has been ranked first in the world in terms of order quantity.
The industrial giant Siemens plans to adjust its production line capacity and production framework from its headquarters in Germany.
However, last year, Mitsubishi Hitachi dominated the large gas turbine (above 100MW) market, with sales accounting for 41%, GE and Siemens accounting for 28% and 25% respectively.
In the new generation F-class gas turbine orders, Mitsubishi Hitachi orders accounted for 49%, GE and Siemens 34% and 16% respectively.
McCoy power reported that the global demand for natural gas and gas turbines began to decline since 2011. 2018 was the worst year for the industry since 2002. The global demand for gas turbines above 30MW decreased by half compared with 2015.
Siemens and Ge are too optimistic about the prospect of traditional energy. After huge investment in traditional energy, we have to deal with this part of the business whose sharp decline in profits has dragged down the overall performance.
In March this year, Siemens considered merging the gas turbine business with Mitsubishi Heavy Industries, but finally chose to spin off the oil and gas and power generation group business.
Ge chose to restructure its power generation business group and continued to lay off employees. On June 17, it announced 450 job cuts in its power generation business in Switzerland. At the end of May, GE power generation cut 1000 jobs in France. In December 2017, Ge planned to lay off 12000 people in the global power generation business.