In line with its ongoing U.S. investment efforts, Siemens announced March 11 that it will build a new 60-hertz gas turbine production plant at its existing facility in Charlotte, N.C. As part of its expanded U.S. presence, Siemens will create a global production hub for manufacturing, servicing and other support functions related to the supply of its gas and steam turbines and generators to 60 Hz markets around the world. The initial investment will be approximately $135 million. Production is slated to start in the fall of 2011. This is the latest in a series of moves designed to support Siemens' clearly defined growth strategy in the U.S. With revenues totaling $21.3 billion in fiscal 2009 (ended September 30), the U.S. continues to be the most important single-country market for Siemens.
"This decision underscores our commitment to the U.S. Over the next five years, we expect employment at the Charlotte site to grow to nearly 1,800 people, with more than 1,000 of those positions new to Charlotte," said Peter Loscher, president and CEO of Siemens AG.
Some 825 new positions will be for the planned gas turbine production, while 226 new jobs were already announced last October.
"Furthermore, just in the past three years, Siemens has opened – and subsequently expanded – a wind turbine blade manufacturing plant in Fort Madison, Iowa, now with over 400 employees, and a second production plant for wind turbine gearboxes in Elgin, Illinois, with up to 350 new jobs. The company also is in the process of building a plant in Hutchinson, Kansas, which will employ another 400 people who will make nacelles for our wind turbines. Just within the wind business we are adding more than 1,000 green jobs to our U.S. workforce," said Loscher.
Siemens has operations and personnel in all 50 states and employs a total workforce of approximately 64,000 in the U.S., of which 10,000 work in the energy sector to provide the systems that supply one-third of the nation's electricity. With annual power generation amounting to more than four billion megawatt hours (MWh), the U.S. is also the world's largest power market.
"The new plant in Charlotte will be the most advanced gas turbine production site in North America and set new benchmarks in terms of quality, productivity and competitiveness," said Wolfgang Dehen, CEO of Siemens Energy. "This is part of our larger strategy to provide new gas and steam power equipment from advantageously positioned manufacturing hubs – in the U.S. and Germany."
"By bundling our activities in one manufacturing hub in the U.S., we can best serve the worldwide 60 Hz energy markets by taking advantage of synergies in terms of transportation, supply base, research and development, among other activities. This is consistent with our ongoing strategy to provide our customers with the best possible technology for the best value," said Michael Suess, CEO of the Fossil Power Generation Division of the Siemens Energy Sector.
All Siemens gas turbines for 60 Hz markets (such as North and South America, Saudi Arabia, South Korea, the Philippines and Japan) will be produced in Charlotte. With the start of production in Charlotte slated for the fall of 2011, gas turbine manufacturing, as well as service and other production-related activities, will be concentrated in one location in the U.S. The production of 60 Hz gas turbines at the Hamilton site in Canada will be phased out. This decision does not impact the production of gas turbines for 50 Hz markets, which remains at the Berlin hub in Germany.
Siemens' production facilities around the world are monitored regularly to ensure they are energy efficient. Locating production in the vicinity of customer markets is one of the criteria for decisions in favor of specific production locations. This allows not only for speed to the market, but also lowers the company's carbon footprint by reducing the distance products have to be shipped, thus significantly reducing CO2 emissions.
Over the past decade Siemens has invested more than $25 billion in all three of its major business areas. For example, the Siemens Industry Sector was strengthened by the acquisition of the U.S. software company UGS Corporation (Plano, Texas) and the water treatment specialist US Filter Corp. (Snellville, Georgia).
In 2005, Siemens acquired Flender Group and its affiliate Winergy Drive Systems based in Elgin, Illinois. With more than 40,000 gearboxes delivered and a market share of over 50 percent, Winergy is the world's largest producer of gearboxes and generators. In August 2009, Siemens opened a second production plant in Elgin to meet the growing demand of the U.S. wind power market. Within three to four years approximately 350 new jobs will have been created there.
In recent years Siemens also significantly expanded its U.S. commitment in the Healthcare Sector through acquisitions. In 2007 alone Siemens invested more than $10 billion to acquire companies in the U.S., such as the U.S. lab diagnostics company Dade Behring Holding Inc. (Deerfield, Ill.), Bayer Diagnostics (Tarrytown, N.Y.), Diagnostic Products Corp. (Los Angeles) and CTI Molecular Imaging Inc. (Knoxville, Tenn.).
The Siemens Energy Sector is the world's leading supplier of a complete spectrum of products, services and solutions for the generation, transmission and distribution of power and for the extraction, conversion and transport of oil and gas. In fiscal 2009 (ended September 30), the Energy Sector had revenues of approximately EUR25.8 billion and received new orders totaling approximately EUR30 billion and posted a profit of EUR3.3 billion. On September 30, 2009, the Energy Sector had a work force of approximately 85,100. In fiscal 2009, revenue from the Siemens Environmental Portfolio totaled approximately EUR23 billion, making Siemens the world's largest supplier of environmentally friendly technologies. In the same period, our products and solutions enabled customers to reduce their CO2 emissions by 210 million tons.