The Siemens Way

Siemens plans on investing up to EUR 600 million in its historic Siemensstadt ­(Siemens City) campus in Berlin. It is the largest single investment in the company’s history and reflects Germany’s strength as an innovation hub.

July 2018

More than a hundred years ago, Siemens purchased 200,000 square meters of land called the Nonnenwiesen between Berlin’s Spandau and Charlottenburg districts. The company chose to site its manufacturing base there because of the ready supply of highly qualified workers – a decision that enabled its expansion through the 20th century and into the 21st. The firm’s first factory opened on the site in 1899. Thirty years later the company built Europe’s first high-rise factory, which manufactured switchgear products. By the end of World War II more than 11,000 people worked there. Now this industrial site is set to become an urban living and working quarter, funded by the largest single investment in Siemens’ history.

A new working and living environment is being ­created out of the old Siemensstadt, a historic industrial site in Berlin-Spandau. Entitled Siemensstadt 2.0, it is the electronics giant’s largest development project ever.  © Siemens AG, München/Berlin

Over the next few years Siemens plans to invest up to EUR 600 million to convert the plant into a mixed-use development called Siemensstadt (Siemens City) 2.0. Commending Siemens’ plans, Berlin Mayor Michael Müller says: “This commitment to Berlin will generate momentum for years to come. New jobs will be created, the city’s status as a scientific center will be enhanced, and its infrastructure will be further developed.” He adds that the project reflects how Berlin is becoming a so-called smart city, where “economic modernity and social responsibility go hand in hand and are being conceived, and lived.”

83bn

Total revenue generated by Siemens in 2018 (Source: Siemens)

Siemensstadt 2.0, which covers an area of 70 hectares, will not only function as a base for industrial production, research facilities, and start-ups but will also be a multi-use urban district, where work, research, living and learning are brought together. “We want to show what the future of work could look like,” comments Cedrik Neike, a Siemens board member and initiator of the project. “Also, we wanted to combine research and production at one location.” Joe Kaeser, CEO of Siemens AG, adds: “We want to lead the way in shaping Industrie 4.0 in the socioeconomic environment. This environment includes a networked ecosystem with flexible working conditions, societal integration and affordable living space.”

»Our German roots are of great importance«

Berlin competes with tech cities all around the world. Cedrik Neike, member of the board of Siemens AG, discusses Berlin’s perks and why talents should consider Germany over Silicon Valley.

Mr. Neike, what exactly are your plans in Berlin?

The basic idea is that we want to show what the future of work might look like. That’s why we looked all around the world for possible locations and finally settled on Berlin. After all, Siemens was founded here 171 years ago. We want to create something new: an open campus where research, teaching, and production can take place.

What gave Berlin the edge over the other global locations you were considering?

We had enquiries from all over the world. In addition to our historical roots, the fact that we already have six plants and existing partnerships that we can expand here tipped the scales. Berlin is dynamic and inventive. A third of the start-ups in Germany are based in the city. Furthermore, we were looking for a tolerant and open-minded city because we want to create an open campus.

Many cities share those characteristics. Why choose Germany specifically?

The fourth industrial revolution, Industrie 4.0, and the Energiewende (energy transition) are already taking place in Europe. We want to combine research and production in one location. Also, our German roots are of great importance in an international context. When I travel in Asia, the perception of “Made in Germany” is very strong. We want to maintain this, strengthen it and develop it further on a new platform.

Is it easy to attract top talent for a job in Berlin?

Germany is quite strong in research, especially in mechanical engineering, energy and medical technology, in industrial automation and in mobility. However, many talented people are still drawn to Silicon Valley. We want to create an environment for them in Berlin in which they would like to do research and come up with big ideas.

Photo: Siemens

The decision to make this investment in Berlin was not an easy one, according to Siemens. The company also considered investing the money in China. “We had requests from all over the world,” says Neike. There are two main reasons why Siemens ultimately chose Berlin. First, it is the birthplace of Siemens, and second, Berlin is widely perceived to have a bright future. Indeed, the company’s decision to further invest in Berlin underlines the city’s reputation for innovation – as well as that of Germany as a whole.

14%

Share of the German market within Siemens’ total 2018 revenue (Source: Siemens)

The next stage of the project will be the tendering process for the site’s urban development, which is planned for late spring 2019. “We now have the exciting opportunity to plan a neighborhood with new buildings where people really enjoy being,” Neike says. “On average, we spend more than 90 percent of our time in buildings. So we should make it as safe, enjoyable, and sustainable as possible.” In the long term, Siemens wants to further develop key technologies such as decentralized energy systems, blockchain, Industrie 4.0, autonomous driving, and additive manufacturing at their new campus – to create a truly new model city.