Siemens in drive to bring turbine jobs to Tyne

Sep 29 2009 By Adrian Pearson, The Journal

It all went wrong before - but now's the time for a fresh start

THE hoped-for investment by Siemens comes more than a decade after investment in the area by the industrial giant ran into trouble and controversy.

In 1996 the Government awarded the German company a £17m grant to help build a microelectronics plant in North Tyneside.

More than a 1,100 jobs were created when Siemens set up its component manufacturing operation at Silverlink. The Queen even toured the plant, which was expected to be the source of high-quality jobs for many years to come.

But it took little over a year for disaster to strike.

With Siemens citing difficulties in the world semi-conductor market, the £530m plant was closed with huge job losses. Siemens later withdrew entirely from making microchips and repaid the Government grant.

In 1998 the Government set up its Siemens Task Force to find a buyer for the Tyneside factory, and save jobs.

In 2000 US microelectronics giant Atmel bought the plant in a multi-million pound deal on condition it received a Government subsidy – this time worth £27.8m, with the first components rolling off the production line the following year.

But it too failed to last the distance.

In December 2006 the company announced it was for sale and it closed the following year. The doomed factory was later demolished.

However, Siemens’ microelectronics venture is far from its only concern in the North East.

Though the economic downturn has hit Siemens, which last year said it was seeking to cut 4% from its global workforce of 430,000, it still employs 2,500 people across the North East.

The German engineering corporation has 900 workers at its Energy Service Fossil business in Heaton, Newcastle.