Siemens Gamesa puts Indian market under scrutiny amid global onshore wind restructuring
Parent company's CEO Bruch says Siemens Energy won't defend markets in which no money is to be made in medium term
Siemens Gamesa is evaluating whether or not to continue in the Indian market as the manufacturer is restructuring its onshore wind business to focus on Europe and the US on land, as well as on offshore wind, said Christian Bruch, CEO of the OEM’s parent Siemens Energy.
“We will not try to defend markets in which there is no money to be made in the medium term as far as margins are concerned.”
Whether India – where Siemens Gamesa traditionally had a strong presence – remains such a market “is something that we are looking at right now,” Bruch said.
“It is a market which is undergoing major upheavals right now, and Asian competitors are also ramping up.”
India is an example of a market, where Siemens Energy is asking itself: “In the long term, can we generate the profit pools we want? Is that the right focus for us or not?” Bruch said.
“This is what we are working on right now. If we see that this is not the case, then of course, these are markets that we will no longer continue to serve. But we are right in the middle of this whole process right now.”
While India and other markets seem shaky for Siemens Gamesa right now, the company is firm in its commitment to the North American market.
“At a later date, we will also develop a revised turbine for the US market. But this is going to happen step by step,” Bruch revealed, adding that the company will also continue to run its worldwide service business for its installed onshore fleet.
The CEO didn’t reveal where job cuts in the onshore business would take place but said the company will try to accommodate employees in other parts of the company, if possible, when it adjusts its production capacities. As the offshore wind segment is growing, the total number of jobs is likely to remain stable, he stressed.
Still, it won’t always be practical to transfer employees to other locations.
“It will not be possible simply to take someone from Taiwan and transfer them to Cuxhaven. That’s not going to be possible,” Bruch said.
After practically no new sales in onshore wind in the past 12 months, it’s going to take some time to ramp the segment up again, the CEO said.
“You will see that revenue will go down, also in the next quarters. This will have an impact on sites and utilisation, sure.”
The company will hold discussions on job cuts internally first during the coming weeks, he added.
Bruch said Siemens Gamesa is looking at retaking sales of its troubled 4.X platform by the end of this year, and of its 5.X platform next year.
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