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Crisis in the wind turbine manufacturer Vestas

Thursday, 12 January 2012
The wind power industry is growing rapidly worldwide, particularly in Sweden. But news came out today that the world's largest producer of wind power, Danish Vestas, is in crisis and may be forced to lay off nearly four thousand employees.
“We face major challenges, not least in the U.S.,” said Vestas CEO Ditlev Engel and explains that the company will cut costs dramatically.
More than 2300 employees are likely to quit within the next few months - more than every tenth employee - and later perhaps another 1500 in Vestas American factories.

This was started since last year as the company’s profits have been wiped out and the view that the important U.S. market is expected to go way down, as a resale of cancelled tax credits for renewable energy becomes the norm
But Vestas is squeezed from other quarters, new suppliers, which depressed prices in wind turbine production.
“The sector is attracting more and more Chinese players in the market and  with their it low cost development and production, the pressure is on” says Gunnar Fredriksson, vice president of the trade association of Swedish Wind Energy.
“But I do not think it suggests that there will be a global economic downturn in the wind power sector but rather that it becomes more competitive.”
This reflected not least in Sweden. In 2009 there were five wind turbine providers, last year it has grown to 14 and one of the major one is Chinese manufacturers now making a first establishment here. If the stiffening competition now hitting Vestas, this is great news for investors, who over the past years have seen prices fall significantly in the wind turbines,” says Gunnar Fredriksson.
“Euro has improved greatly and it may have influenced 20 to 25 percent in turbine prices because we buy mostly in euro,” he said.
By Scancomark.se Team

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