Daily Management Review

Siemens to invests $ 5.6 billion in Argentina


German industrial conglomerate Siemens AG has signed an agreement of intent to participate in Argentinian transport, energy and infrastructure projects in the amount of $ 5.6 billion. This was announced by the company’s Chief Executive Officer Joe Kaeser.

surber via flickr
surber via flickr
According to Kaeser, President of Argentine Mauricio Macri intends to overhaul the Argentine economy, so now is the time to invest in this country.

"I'm happy because today we can help rebuild the country", - Siemens’ spokesman said. He added that other investors need to act quickly so as not to miss their chance, because "it may be too late tomorrow."

Siemens could become the largest investor in Argentina since Macri got his post in December 2015. Its investment plans can be seen as a vote of confidence in new President of Argentine. At the same time, it highlights potential of Argentina as a producer of renewable energy, Kaeser said.

Each project will receive from Siemens about $ 3 billion of funding, and will create 3 thousand direct and 7 th. related jobs in Argentina in the future. It is planned that Siemens’ projects will generate 5 gigawatts of energy capacity.

In the statement, Siemens confirmed its plans to double its business in Argentina in 2020.

Europe's largest industrial conglomerate Siemens AG improved forecast of annual profit for the second time this year. Quarterly results in majority of the group’s divisions exceeded market expectations.

Siemens expects that 2016 fiscal year, completed on September 30, will bring profit 6.5 to 6.7 euro per share. Previously, the company expected 6-6,4 euro per share.

In this financial year, Siemens expects to cut costs by 950 million - 1 billion euros, rather than 850-950 million euro as originally anticipated.
In April-June, Siemens's net profit amounted to 1.372 billion euro compared with 1.378 billion euro a year earlier. Quarterly revenue increased by 5%, to 19.8 billion EUR, orders rose by 6% - to 21.1 billion euro.

Thus, profit of industrial divisions of Siemens jumped by about 20%, to 2.19 billion euro, and exceeded consensus forecast of analysts polled by Thomson Reuters respondents.

Siemens is now holding a global repositioning to finally get of its image of a company, which manufactures phones and consumer products. The German manufacturer intends to show impact of their technologies to development of society.

The company’s new slogan "Ingenuity for Life", developed by Ogilvy & Mather agency, emphasizes the new brand positioning. It was created to showcase how Siemens works in three key areas: product innovation, energy conservation and a "smart" infrastructure. The global repositioning will completely change the current brand communication, following adoption of the new strategy. It is based on automation and digitalization, the main strategic directions of Siemens.

Siemens is a pretty private company, and consumers have little knowledge of its orientation. For example, the company provides electricity for cities and countries, produces equipment for hospitals and high-speed trains. However, an average consumer does not know about it. Wrong perception of the brand influences pace and quality of development. Therefore, one of the main tasks of repositioning is to convey to everyone that Siemens produces the most innovative technologies to improve the quality of life. 

source: bloomberg.com, thedrum.com