It’s Wednesday morning and a few minutes after eight o’clock, Roland Busch brings out this really not so easy to digest word construction. The man who’s been the boss here since February says Siemens is now a “focused tech company” and he drags the words with relish. He will say it even more often at this morning press conference, over and over again: “Foook-focused technology company”. If a boss sits down in front of the stage and repeats it over and over again, then of course that means something. This two-word combination, which has been a staple in corporate rhetoric for months, must be remembered well in these an hour and a half. So, what are Siemens guys? A technology-driven company. Of course, what else!
But what exactly is it supposed to be? And what is Siemens no longer?
Profit is 59% higher – for the boss, it comes at the right time
Responses to Siemens Annual Press Conference. It is November 2021, so there is a lot of distance between people who have either been vaccinated or recovered, the mini croissants lying on small plates are covered with plastic film. In the past, we would have talked about power plants, gas turbines, computer tomographs and x-ray machines at this point. And earlier, maybe even from light bulbs, and even earlier from semiconductors and chips. Anything that once belonged to Siemens and is now called Osram or Infineon or something completely different.
The large medical technology company has been called Healthineers for several years and has been publicly traded for three years, the energy company, once 40 percent of all Siemens business, has been publicly traded for a year under the name of “Siemens Energy”. What’s left? Well, a “focused tech company.” A remainder of Siemens with industrial automation, digital activities, infrastructure and construction projects and trains that have beaten all forecasts and increased their profit in the last fiscal year by 59% to 6.7 billion euros. In the Corona year, of all things, but it shows: Siemens is there when the economy picks up.
The day before Siemens, the former energy division Siemens Energy, now a Dax company like the Munich mother, published its figures. The energy giant recorded a loss of 560 million euros; the year before, however, the hole was three times bigger. Since Siemens only owns 35 percent of Siemens Energy, a large part of Siemens Energy’s losses are no longer Siemens’ losses, but only part of the balance sheet. You have to know this to understand what such concentration is.
Open detailed view
Without a mask, but with a distance and the 2-G rule: Siemens boss Roland Busch at the annual press conference.
(Photo: Sven Hoppe / dpa)
Instead of talking about power plants, a Siemens boss today talks about growing with digital businesses, how the digital and mainstream industry are coming together, and he also recently talked – no kidding – about lettuce, tomatoes and sprouts. Pesticide free, “freshly harvested, longer shelf life” https://www.sueddeutsche.de/wirtschaft/. “In short,” says Busch, “this is about healthy and sustainably produced food for the future”.
Superfood and Suez Canal on rails
The big business, which started years ago to hunt down mega-trends in mega-metropolises and solve problems, has now landed on vertical farming, with food production in and on buildings. “I almost want to say: superfoods,” Busch says. Siemens’ farming partner is from the United States and is called 80 Acres Farms. Do not you know? Not yet.
From lettuce to artificial intelligence, digital twins and simulations, charging stations for electric cars, and from there it continues by train to Egypt, where the targeted company signs a first contract for a route of 660 kilometers between the Mediterranean and the Red Sea A. Infrastructures, trains, services, all for a good three billion euros. Other contracts will follow, it is a total network of 1,800 kilometers long. “We are building a Suez Canal on rails here,” explains the head of Siemens.
And this will continue, other parts of the business that are no longer important to Siemens should be prepared for a sale. This also includes activity with large drives, electric motors, converters and generators for medium and high voltage. And the logistics division must first be split into logistics solutions for letters and parcels and baggage belts for airports; Yunex road traffic technology subsidiary has already been split. There is always something you can no longer use.
General Electric is now on Siemens
Just before the appearance of the boss of Siemens, Busch, the great American competitor General Electric (GE) spoke. GE wants to split into three listed companies over the next three years: for medical technology, for energy and for aviation, which probably means nothing more than: even the struggling 130-year-old conglomerate wants apparently concentrating now. Does this put Siemens under pressure now? No, said Busch. “We took the actions – from a strong position – that GE is now following.” There must have been pressure to act, says Siemens CFO Ralf Thomas. The two conglomerates of the United States and Germany have been compared for decades. “We’re not a conglomerate,” Busch says, so that it’s immediately clear. Corn? Exactly.