The Siempelkamp group aims to shift more of its manufacturing activity to operations in China and the Czech Republic, in response to competitive forces in the industries it supplies, as well as to weakening demand in markets like Russia and Brazil. In 2016 and 2017, it will eliminate a total of 350 jobs in Germany.
However, the German engineering group emphasized its headquarters in Krefeld would remain “the heart and mind” of its organization.
Siempelkamp Maschinen- und Anlagenbau GmbH develops technologies and manufactures machines for forging, rolling, and press forming operations. Its iron foundry at Krefeld casts large-scale components of those systems, and the group also provides engineering services for plants in those industries.
In the past several years Siempelkamp expanded to new manufacturing locations in the Czech Republic and China, along with extending its sales and service network.
The new manufacturing site in Qingdao, China, started up in October 2015. It will be used “much more intensively” in the future to produce large-scale parts for press manufacturing, according to a release.
"We will produce where our customers are," emphasized Dr. Hans Fechner, managing director. "Furthermore, we will significantly expand our production facility in Blatnice, Czech Republic, in order to continue being able to produce at competitive prices in future."
However, he emphasized that "complex technologies and business secrets will remain here in Krefeld, and at other locations in Germany." The group plans to establish a logistics and service center in Bad Kreuznach to manage global supply of replacement parts to Siempelkamp customers.
The group predicted these steps would solidify and expand its market position and technological leadership, particularly in the wood-based panel and metal forming industry, particularly in China.
Siempelkamp’s Foundry Technology business unit is one of the most affected segments of the restructuring in Germany. The group noted that its iron casting operation is suffering due to the embargo policy in place against Russia (in place since that country launched hostilities against neighboring Ukraine), as well as a Russian “counter-embargo.”
Other factors affecting the foundry business include declining demand from the global mining industry (a consequence of falling raw material prices), and “general weakness of the BRIC countries,” which has led to customers to postpone investments indefinitely.. "We expect no improvement of the situation in the foreseeable future, and therefore have to react now," according to Fechner.
Siempelkamp’s Engineering and Service business unit has been adversely affected by the German government’s decision to phase-out nuclear power operations, meaning fewer employees are required for related operations. Siempelkamp’s production of large-scale storage casks (at Mülheim an der Ruhr) has stabilized, but at a lower level.
In the U.S., Siempelkamp’s businesses dismantling nuclear power plants is doing better. It recently completed the largest dismantling project in the history of the American nuclear energy industry, for reactor pressure vessel at the Zion nuclear power plant in Illinois. The company expects more awards for projects of this type, the managing director indicated.
"This now represents the implementation of the strategy that we have long been announcing – the internationalization of the Siempelkamp technology group. The general conditions in the global economy have confirmed the necessity of this step. Siempelkamp is still technology leader in many key markets, and will remain so,” Fechner concluded.