Siemens announced on 23 July that it plans to cut 2,500 jobs worldwide before the end of 2009 in its transportation engineering and manufacturing business.

It intends to shed its production facility in Prague, which employs around 950 people, completely - although selling the factory is viewed as one of the options available.

The German and Austrian locations of the division are to be retained. In Krefeld-Uerdingen (Germany), Siemens proposes to cut 220 jobs after all the repair services for the Combino tram come to an end there. The planned reduction of a further 630 jobs will primarily affect the factories in Braunschweig, Nuremberg, Erlangen, Berlin, Offenbach, Constance, Düsseldorf, Vienna and Graz. No jobs are to be lost in Munich.

'In the necessary reorganisation process, excess capacity in our factories will be eliminated. This will ensure the long-term competitiveness of the Mobility Division', said Hans-Jörg Grundmann, CEO of the Mobility Division.

The main reason for the excess capacity is the increasing proportion of customers in growth markets such as China, for example, who more and more frequently demand the involvement of local partners. Siemens is therefore planning to hand over aspects of production entirely to subcontractors, as happens in the automotive industry.

In future, the production of Siemens rail vehicles is to be concentrated in three centres: aluminum vehicles are to be made in Krefeld-Uerdingen, steel vehicles in Vienna and locomotives in Munich. Production locations close to the customer such as the tram manufacturing plant in Sacramento (USA) are to be retained.

As already announced in early July, a total of 2,500 jobs are to be cut worldwide in the Siemens Mobility Division in the course of the comprehensive restructuring programme. Around 700 of them will be in sales and administration and 1,800 in engineering and manufacturing, primarily in Europe, where 850 jobs are to go (see table).