Siemens Gamesa will lay off up to 600 employees in Denmark as the wind turbine manufacturer moves ahead with plans to discontinue production of direct-drive onshore wind turbine designs from its Siemens Wind legacy technology portfolio.
The OEM said the layoffs come out of its ‘L3AD2020’ strategy announced in early 2018, when the company said it will focus on geared technology for onshore wind turbines as part of a €2bn ($2.2bn) cost reduction plan.
“These difficult measures are necessary as a responsible resolution to an increasingly competitive industry landscape,” said Andreas Nauen, managing director at Siemens Gamesa Denmark.
“We need to continue executing on our L3AD2020 program to serve our global customers and markets as reliably and competitively as we do today.”
The announced layoffs at Siemens Gamesa follow an announcement by rival Vestas to shed about 90 of its employees at a facility in the Danish town of Ringkøbing, where it produces nacelles and hubs for its 4MW platform. Vestas said the job cuts are a response to a downturn in the European market for onshore wind turbines.
Ending direct drive technology in onshore wind fits into Siemens Gamesa’s ‘one segment, one technology’ strategy, the company said.
Onshore direct drive production will be phased out in at the factory in Brande, Denmark, at the end of next year, while onshore blade production at a plant in Aalborg will already cease at the end of this year.
Offshore blade production in Aalborg, along with development, prototyping and testing of new offshore blades, will continue, however.
Additionally, the plant in Brande is facing a temporary load reduction for the offshore segment as a result of recent project delays in Denmark.
Negotiations with local workers council about the 600 layoffs are intended to start in October.
The OEM stressed that Denmark will remain a key location for it as a core competence hub for its worldwide activities.