* Kaeser makes job remarks at NY investor conference
* IG Metall says they are "declaration of war" if true
* Storm comes as Siemens is considering bid for Alstom
(Recasts with Kaeser memo to staff, union reaction)
By Noah Barkin and Jens Hack
BERLIN/MUNICH, May 30 The chief executive of
German conglomerate Siemens tried to calm a brewing
storm over job cuts on Friday after he let slip at an investor
conference in New York that his plan to restructure the company
could put up to 11,600 staff at risk.
Joe Kaeser, who was vaulted into the top job at the
Munich-based firm nine months ago, unveiled an overhaul earlier
this month that removes layers of management by abolishing a
corporate structure, along sectoral and regional lines, that was
put in place by his predecessor Peter Loescher.
At the investor conference he was pressed to give more
details on his goal to save 1 billion euros annually through the
restructuring, and responded by attaching specific job numbers
to the scheme for the first time.
"We do away with the four sectors; 7,600 people work in
sector coordination, coordinating a middle layer that is gone,"
Kaeser said, according to a podcast of the remarks posted on the
Siemens website. "Another 4,000 people were doing a regional
cluster analysis, which is not necessary anymore."
German media jumped on the comments, initially reported by
Bloomberg, adding the two figures together and coming up with
total cuts of 11,600.
The reaction from powerful German engineering union IG
Metall was also swift.
In Germany, staff cuts are traditionally discussed with
union members behind closed doors before becoming public. The
fact that Kaeser was in the United States talking to investors
when he made the comments was all the more galling to workers.
"We are shocked to learn that Joe Kaeser announced in New
York that he plans to cut some 11,000 jobs," said Klaus Abel, a
union representative in Berlin.
"This would be a declaration of war on IG Metall if he
really meant this. We are still operating under the assumption
that these jobs will not be cut, rather the company will be
Kaeser can ill afford a showdown with unions which might
distract from his ambitious overhaul, dubbed "Vision 2020", and
from separate plans to bid for the power assets of French rival
Alstom, already the target of an offer from U.S. giant
The reports sent Siemens into damage control mode. Fresh off
his return flight from New York, Kaeser issued a memo to the
company's German staff, reassuring them that no final decisions
on cuts had been taken. Siemens employees 360,000 staff
worldwide, a third of which are based in Germany.
"These headlines have created confusion. They worry me and
surely worry you too!" said the Kaeser note, seen by Reuters.
"First the most important: The reports are not right and are
based on a wrong interpretation."
Talks on concrete measures linked to his efficiency drive
would begin soon and be conducted in an atmosphere of mutual
trust between the proper partners, he added.
Kaeser's predecessor Loescher ran into trouble with unions
when he tried to push through job cuts. He was pushed out last
summer after a series of profit warnings.
Kaeser has vowed to restore a sense of pride at Siemens,
which traces its roots back to an electrical telegraph company
founded in Berlin in 1847.
It was unclear whether his comments might hurt Siemens'
chances of snaring Alstom's power assets from the clutches of
GE, but the headlines seem unlikely to help his cause in Paris.
Earlier this week GE Chief Executive Jeff Immelt met with
French President Francois Hollande and promised to create 1,000
new engineering and manufacturing jobs within three years of a
deal with Alstom, according to sources familiar with the talks.
Siemens shares closed down 0.35 percent at 97.5 euros.
(Editing by Arno Schuetze and Pravin Char)