Siemens takes over parts of Parsons
Thursday 10 April 1997
The takeover will increase Siemens workforce in the North -east to more than 2,000, making it one of the most important employers in the area. It already has a silicon chip plant in the North-east which will start deliveries in August.
But the deal will also mark the demise of Parsons - one of the most illustrious names in British industrial history, founded in 1889 by Sir Charles Parsons, the inventor of the steam turbine.
Siemens is to take on Parsons' spares business and some of its manufacturing and engineering operations employing a total of 880 people. A further 120 Parsons employees are being relocated to other Rolls-Royce divisions in the North-east.
But the future of the 300 employees working on Parsons' two remaining power station contracts in India looks bleak. If they are made redundant when the contracts are complete early next year then 1,100 workers will have lost their jobs since Rolls announced it was pulling out of the heavy steam turbine business last summer at a cost of pounds 248m.
Barney McGill, works convenor at Parsons, said he was delighted at the announcement though he remained disappointed that more jobs had not been saved. He said: "This was a good day on the whole. There was a real possibility the company could have been lost forever so we're delighted it's been saved. The negatives are that we've lost so many jobs, but even the people who've been made redundant have said they hope above all that Parsons carries on."
Siemens intends to use the Parsons factory to manufacture components for its main steam turbine generator factory in Mulheim, Germany and parts for existing customers.
But it will never again manufacture steam turbines bearing the Parsons name and Parsons Power Generation Systems is being subsumed into Siemens' existing UK power generation sales arm to form a new company, Siemens Power Generation.
Jurgen Gehrels, chief executive of Siemens in the UK, said he felt sad that one of the "pioneers of power generation" would be no more. But he added: "We are a global player in power generation and Parsons wasn't, that was one of its weaknesses. I hope the name will not disappear completely. I hope we can use it in some form."
Mr Gehrels also cautioned that there was no absolute guarantee of a job for any of the workers it was taking on. "We have not taken on 880 people to make them redundant but the only way to guarantee jobs is to improve competitiveness all the time and we have a long way to go in Newcastle."
The turnover of the business being taken over by Siemens was pounds 60m last year compared with Parsons' total sales of pounds 150m. In total there are 57,000 megawatts of Parsons-built turbines in operation around the world.
Although Siemens is far larger in power generation with 150,000 megawatts of installed capacity, sales last year of DM8bn and new orders totalling DM9bn, Mr Gehrels said that Parsons' customer base would give it access to new markets.
Despite the fact that there is overcapacity in the heavy steam turbine generation market, he also said that Siemens needed the manufacturing facilities that Parsons has in the North-east.
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Rozanne Duncan: Ukip expels councillor for 'jaw-dropping' comments made in BBC TV interview
Sony hack: Angelina Jolie branded 'seriously out of her mind' in further embarrassing leaked email saga
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
iJobs Money & Business
£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...
£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...
£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...
£20000 - £25000 per annum + OTE £35000: SThree: SThree are a global FTSE 250 b...