On February 6th/7th, an extended meeting of the Executive Board of the Siemens European Committee took place at Munich to discuss internally and with the management the situation at the Power and Gas division in Europe and the announced job cuts.
The participants came from Germany (Mülheim, Berlin, Duisburg), UK (Lincoln), Sweden (Finspǻng), Netherlands (Hengelo), Norway, Hungary (Budapest) and Austria (Vienna). Additionally, the members of the Executive Board of the Siemens Europe Committee (Harald Kern (Germany), Bettina Haller (Germany), Christian Schaller (Austria; also representing Vienna), Roy Lund (Norway; also representing PG Norway) and Ferran Navarro (Spain) took part.
During the internal meeting of the union representatives, the participants exchanged their information about the announced job cuts resp. other measures: At the plant in Mülheim, Germany, there have already been job cuts in 2015. Now, another 740 jobs are threatened. At Berlin, Germany, 380 jobs are at risk by the plans to shut down parts of the production and relocate the work to low cost countries. At Duisburg, Germany, 600 jobs have been cut in the last four years. The union representatives have a lot of complaints about the Dresser-Rand management, which runs the factory. The factories in Görlitz and Leipzig, Germany, and the engineering office in Offenbach, Germany, are supposed to be closed. The factory in Erfurt, Germany, is supposed to be sold. All together, 6 100 jobs in Germany are at risk.
In Lincoln, UK, there have been job cuts during the last years. The union representatives have not received very much information about the current plans up to now. The unions in UK additionally feel unsafe about the consequences of the exit of the UK from the European Union for their economy. At Finspǻng, Sweden, the management wants to cut 110 jobs. There has been no background information up to now. In Sweden, there is a legal obligation for the management to negotiate this kind of measures with the unions before performing it. The PG site at Hengelo, Netherlands, will be shut down or sold, according to the management. The information of the employees was a big chaos. 600 employees are concerned. The number of jobs at Dresser-Rand in Kongsberg, Norway, is supposed to be cut from 250 to 100. The future of the site is unclear.
The management has also announced to cut 200 jobs at PG in Vienna, Austria. This location had just been saved by the union some years ago. There will also be job cuts in Brno, Czech Republic, and Elblag, Poland. Work will be relocated to Budapest, Hungary. The union representatives have not received a clear information up to now. The wages there are still so much lower than in Western Europe that it is difficult to attract skilled workforce.
PG is suffering from a huge decline of orders. The main reason for the announced measures are not labour costs, but structural costs caused by over-capacities. The management´s answer is the closure of complete locations.
In Germany, Siemens has a very bad press at the moment, especially because of the announcement of the closure of complete locations while also announcing a huge profit. There has even been a lot of criticism from shareholders at the annual shareholder assembly in January. Joe Kaeser, the Siemens CEO, has attracted more negative opinion by his statements while sitting next to the US president Donald Trump at this year´s World Economy Forum at Davos, saying, he would prefer Charlotte, USA, as the major Siemens site for new developed generators.
The union representatives agreed, that the announced measures are one more step to finish off the manufacturing capacities of Siemens in Europe. The unions are demanding alternatives to the announced plans, especially because they see the decline of orders in this business sector as only temporary.
On the second day of the meeting, Mr. Haas from the Siemens PG management gave some information from the management´s point of view and discussed the topic with the union representatives.
The union representatives expressed their criticism of the lack of strategy for the sector and the company´s information policy. Mr. Maas pointed out, that on one hand, regenerative energies have become more competitive, so that the amount of orders from the fossil power side will probably never return to the old number. Even the market in China is declining. On the other hand, the oil price has decreased dramatically. Consequently, there are huge over-capacities in the PG business sector. This concerns all competitors, not only Siemens. The profitability of the business will be affected, too.
The turnover of Dresser-Rand has declined dramatically, but should recover to some degree in the next years.
Mr. Haas promised to appoint contact persons for the union representatives in each country to continue the negotiation process on local level.
In their internal final circle, the union representatives agreed on building a PG network and to continue to fight for alternatives to redundancies and the closure of locations for every site of Siemens in Europe.