Siemens’ new Singapore factory on track despite move to cut 6,000 jobs globally

[SINGAPORE] The impact of Siemens’ global job cuts on its Singapore workforce cannot be determined yet, as the German industrial giant is still deciding how the layoffs will be made across different locations.

On Tuesday (Mar 18), Siemens said that it would cut more than 6,000 jobs – about 2 per cent of headcount – worldwide, with most of the reductions made in its factory automation business. The rest will be in its electric vehicle charging unit.

The company is unable to confirm yet whether, or how, the workers in its Singapore office will be affected, a spokesperson for Siemens Singapore told The Business Times on Wednesday.

But a new Tuas factory, scheduled to begin operations in 2025 or 2026, will not be affected. The facility will allow Siemens to “even better serve the growing South-east Asian markets”, the spokesperson said.

Meanwhile, the global layoffs will take place “over the next two years across several areas and regions”, the spokesperson added. “We will follow the established process with the labour representatives… and then inform our people in the respective countries or locations locally and via the responsible organisations.” 

The spokesperson said that Siemens will implement the job cuts “responsibly, wherever possible” through natural fluctuation, early retirement and internal movements. “We currently have around 7,000 open positions in the company. We will support the application for these positions, and also offer... assistance in retraining for other positions, if needed.”

Aside from the global job cuts, there are no broader restructuring plans for Singapore at this stage, added the spokesperson.

In June 2023, it was reported that Siemens was building a new factory in Singapore for its industrial automation and digitalisation products, with more than 400 local jobs expected to be created.

Muted demand

Siemens’ latest round of layoffs is its most extensive since 2017, when it slashed 6,900 jobs globally as part of a broader restructuring of its power division.

In the current exercise, about 5,600 reductions will come from its automation business – which supplies robotics, machinery and software to factories – with about half of the roles lost in Germany. These cuts will take place by 2027.

Siemens has grappled with muted industrial automation demand in key markets such as China and Germany, as well as greater competition, which hit orders and revenue over the past two years, Reuters reported.

The company’s automation unit also dragged down its profit for the first quarter ended Dec 31, 2024, by 8 per cent to 2.5 billion euros (S$3.6 billion), from 2.7 billion euros in the previous corresponding period.

In vehicle charging, Siemens plans to cut 450 positions – out of 1,300 worldwide – by the end of the current financial year.  

The layoffs follow other German industrial giants’ cost-cutting plans.

Volkswagen’s Audi on Monday said that it would cut 7,500 jobs in administration. Volkswagen itself has unleashed a cost-cutting programme involving 35,000 job reductions, while Porsche plans to cut 3,900 positions.