2023-11-21 19:39:44
MADRID
Updated Tuesday, November 21, 2023 – 18:39
Gamesa cut costs by 400 million to resolve its crisis. The company has stopped the sale of wind turbines and stopped guaranteeing the delivery of some orders.
Siemens Gamesa wind turbine in a wind farm in Spain.EL MUNDO
Siemens will apply a severe adjustment of 400 million euros to its subsidiary Gamesa to restructure the business and return it to profitability within two years. The German company has summoned financial analysts today to explain its exit strategy from the crisis, which fully affects the group’s presence in Spain, where it has nine factories and an R&D center that directly employ almost 5,000 workers.
Siemens has indicated that it will restructure its onshore wind installation activity based on criteria such as “the existence of favorable regulations and policies and the obtaining of significant benefits, which will allow optimize industrial footprint “The presence in Spain is so relevant that one of the Government’s main tasks is to become the second contributor to the rescue of the company, after Germany. The total cost of this rescue amounts to 15,000 million euros and the new Minister of Industry, Jordi Heru be in charge of containing the impact on employment with the offer of public guarantees and support for new projects.
But, for now, Siemens has avoided specifying how to apply the proposed structural adjustment. Throughout this week he is expected to inform the workers and the Ministry of Industry about his plans in Spain. UGT has criticized “the obscurantism” of Siemens Energy, regretting that it has not defined when it will resume Siemens Gamesa’s commercial activity paralyzed after technical problems were detected in its main models of land-based wind turbines. “If there are no sales of wind turbines in a short period of time,” UGT FICA has warned, the viability of the company and its suppliers will be penalized, in addition to jeopardizing the future of Gamesa’s 5,000 workers.
What is clear is that the company will enter a stage of more moderate growth in the next two years. Rather than accelerating production to win new customers in the global energy transition race, in the next four years it will absorb the almost 17,000 million euros that have accumulated in orders. “Market share is no longer our priority,” the company summarized. Its president, Christian Bruch, has explained this by indicating that, in the future, Siemens will continue in the renewable and wind business but will change its current approach.
Over the last few months, the company has created a technical team of 50 people to investigate the origin of the failures in the turbines, finding problems in the turbines themselves, in the propeller production process and in some materials. The tracking led, according to CEO Jochen Eickholt, to factories in Portugal, Spain, Mexico and India. For this reason, the marketing of wind turbines on the 5x platform has been suspended and Gamesa, the third largest global turbine manufacturer with almost 60,000 units installed around the world, has opened discussions with customers to inform them that “does not guarantee certain deliveries within the expected time frame.”
The extent that this stoppage may have in projects and promotions already underway has not been determined by Siemens either, but taking into account that its market share in installed wind power in Spain exceeds 50%, it could be considerable. Lack of infrastructure can delay the connection to the wind farm network within the period provided for by the Energy Transition, in addition to causing significant economic damage to developers and large clients. The company has already started talks with these agents and, as it has admitted, is renegotiating contracts. A good part of the provisions that it has charged on its balance sheet will be allocated to an expected fear of litigation to compensate for these non-compliance.
#Siemens #announces #cuts #million #euros #Gamesa #impact #Spain