Vestas, the world’s largest wind turbine manufacturer, is to restructure its operations, entailing the loss of 2,335 jobs, as it seeks to reduce its fixed costs by more than Eur150 million from the end of 2012. The job losses, equivalent to about a tenth of its workforce, will result from factory closures and the streamlining of support functions to align capacity with market demand.
The international wind generation components industry has been impacted by overcapacity and falling turbine prices. The consolidation of Vestas’ manufacturing operations is designed to capture cost synergies and reduce capital required for future growth as well as to increase flexibility in case of a prolonged industry slowdown.
In addition to the planned layoffs of 2,335 employees in the coming months, Vestas is also preparing for a potential slowdown in the US in case the present Production Tax Credit (PTC) is not extended. This could result in the lay off of an additional 1,600 employees at plants in the US. The potential savings in this respect will be in addition to the Eur150 million already planned.