By John Revill
ZURICH (Reuters) -Siemens will spend 2 billion euros ($2.16 billion) on a new global investment plan, the German engineering and technology group said on Thursday, as it gears up to meet increased demand triggered by global stimulus packages.
Siemens will build new factories, research and development centres and training sites around the world, the company said in a statement, as it aims to tackle problems exposed by the COVID pandemic and rising geopolitical tensions.
As part of the investment programme, which will cover announcements made during 2023, Siemens will spend 200 million euros on a new plant for its industrial automation division in Singapore.
"Siemens is experiencing significantly above-market growth. Today we announce an investment strategy to boost future growth, drive innovation and increase resilience," said Siemens Chief Executive Roland Busch in a statement.
Siemens will also increase its research and development spending by 500 million euros this year, the company said on Thursday.
The company, which employs 311,000, is seen as a bellwether for the health of the global industrial economy. In 2022 it increased its annual sales by 16% to 72 billion euros.
"This wave of investments is supported by our record order backlog and reflects our confidence in the future," Busch later told an event in Singapore.
The company has previously said its expects its total addressable market for its products, which range from trains to industrial software, to expand by 7% per year between 2022 to 2027.
The increase in market size, from around 500 billion euros at present to nearly 700 billion euros, will be partly driven by stimulus programmes like the United States' $369 billion Inflation Reduction Act and the 245 billion euro support from the European Union's Green Deal Industrial Plan.
Siemens also wants to grow faster than rivals, which include Johnson Controls, Alstom, Schneider Electric and ABB , and increase market share, Chief Executive Busch told analysts last month.
The investment programme could also be a response to the global COVID-19 pandemic, which gummed up supply chains and made it more expensive to transport products and components.
The company has already announced expansion plans for sites in Germany and the Czech Republic earlier this year, as well as invested $220 million in a new rolling stock factory in Lexington, United States.
Further investment in the United States and Europe are also planned, the company said on Thursday.
($1 = 0.9245 euros)
(Reporting by John RevillEditing by Tomasz Janowski)
