The German industrial conglomerate Siemens cut or moved to other countries over 1000 employees, who are working in divisions dealing with production of equipment for drilling and mining companies in Germany. The sector is suffering from serious financial and liquidity problems on the background of lower oil prices. Siemens was forced to improve the liquidity and cash flows by reducing capital spending. Siemens was making the cuts because the Process Industries and Drives Division in Germany unit’s capacities were underutilized, driven by the crisis in the oil production sector.
The German industrial conglomerate refused comments over the job reduction program and closure of business units, but recently announced job-cutting measures as it battles to cope with subdued economic growth and weak demand from energy customers.
Last week, Siemens announced cutting of 300 jobs in another oil-related plant – Mount Vernon. The German industrial conglomerate is dealing with low oil and gas prices, which slid with 70% during the last year. Many employees of the company engaged with assembly and testing functions are being moved to Siemens plants in other cities or sacked. The Mount Vernon plant, which now has about 600 employees, will continue to house some sales, technical support and research jobs.