Siemens Healthineers invests $150M, with eye on ‘bringing manufacturing back to the US’
Siemens Healthineers said Wednesday it will invest $150 million on new and expanded manufacturing facilities, with an eye toward “bringing manufacturing back to the U.S.”
The Erlangen, Germany-based company said the changes will include relocating manufacturing operations for its acquired cancer care company, Varian, from Baja, Mexico, to Palo Alto, California. This change will lead to the addition of 50 new manufacturing jobs, reducing the complexity of its supply chain while improving Siemens’ ability to address demand for radiation therapy solutions.
These new investments come on top of the $900 million Siemens Healthineers spends on research and development in the U.S. annually. Another $1 billion of its funds have gone toward expansion, acquisitions and partnerships in the States since 2019.
Altogether, Siemens Healthineers employs about 17,000 team members in the U.S. working across 18 locations nationwide.
“Our significant U.S. employee base and broad portfolio of innovations are making vital contributions to the American healthcare system,” John Kowal, president and head of Siemens Healthineers in the Americas, said in a statement May 14. “With these new investments, we’re further demonstrating our long-term commitment and desire to grow along with the American economy.”
The changes come amid global trade challenges and new tariffs from the Trump administration, placed on goods imported to the U.S. Siemens Healthineers reported its quarterly earnings results May 7, estimating it plans to spend upward of $340 million on “tariff mitigation efforts.” Officials at the time said they were uncertain about moving manufacturing to the U.S. in response to these challenges.
In addition, Siemens Healthineers' investments will include “strengthening supply chain resilience” by opening “mega” depots in Dayton, New Jersey, and Manteca, California. This will allow the company to increase the availability of parts by nearly one-third, offering “unprecedented delivery flexibility to customers.” The company plans to spend $141 million to construct a 60,000 square foot “Experience Center” in Charlotte, North Carolina, as part of the city’s research and innovation district.
Siemens Healthineers estimated Monday the United States generates about 36% of its revenue. The country also is its global headquarters for divisions including Varian, laboratory diagnostics, ultrasound, molecular imaging and PET. In total, Siemens Healthineers has 72,000 employees and generates annual revenue of over $25 billion.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.