Siemens is to shed 15,000 jobs over the next year, a third of them in Germany, as part of a six billion euro ($8.4 billion Cdn) cost-cutting program, a spokesman said on Sunday.
The announcement comes two months after CEO Peter Loescher, who drew up the plan for downsizing late last year, was ousted from his job.
Siemens is Europe's biggest engineering firm and its products range from hearing aids to gas turbines.
But it is anxious to close the gap with more profitable rivals such as U.S.-based General Electric Co and Switzerland's ABB.
Siemens and its unions have reached an agreement over about half of the job cuts and a deal on the other half will follow, the spokesman said.
He added that Siemens wanted to end speculation in the market about the number of jobs that are about to be cut.
No workers have been laid off so far and Siemens has said it does not intend to make enforced redundancies, relying instead on attrition and voluntary severance deals.
In Germany, about 2,000 jobs will be cut at the company's industrial unit and another 1,400 at its energy and infrastructure business, the spokesman said.
Siemens expects to close the current fiscal year on Monday with around 370,000 workers, and the planned cuts amount to about four per cent of its workforce.