Falling telecoms orders at Siemens raise further questions over GPT

Falling telecoms orders at Siemens raise further questions over GPT
Richard Wilson
Siemens has seen orders with its public telephone operator customers fall in the first six months of the year, putting new pressure on its future involvement with GPT.
While sales of public telephone systems such as exchanges and transmission systems were 28 per cent up in the first half of the year, future business looks less strong as orders slumped by seven per cent on the same period last year. This may have a significance for talks currently taking place between Siemens and GEC about the future of their telecoms joint venture GPT. Recent reports suggest that Siemens has finally accepted that it can sell its 40 per cent stake in GPT to GEC.
Since the business systems activity was spun-off into a separate company last year, GPT’s business has been dominated by sales to the public telephone operators. Signs of pressure in this market could convince Siemens, which has its own substantial telecoms business, to sell its interest in GPT. Siemens has warned that it may not meet its profits target this year of Dm3bn ($1.7bn).
The German engineering group blamed a number of factors including the fall in the price of DRAM memory chips as well as the economic crisis in the south east Asia.


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