6,000 jobs to go at Siemens-Gamesa as power division faces similar cuts
By Paul Homewood
So much for all those new green jobs!
Siemens Gamesa plans to cut as many as 6,000 jobs worldwide with sales expected to dip by around a fifth in 2018. Meanwhile Siemens is trying to curtail the need for a similar cut to its overall power division.
If the cut is carried through, it would amount to more than 20 per cent of the wind power company’s total workforce of around 26,000.
Wind turbine makers have been facing growing competition, putting pressure on pricing and inventory values and raising expectations for more takeovers to build scale.
Sales are projected to fall to between EUR9 and 9.6bn this year from about EUR11bn in fiscal 2017, a 5-per cent gain from year-earlier levels.
“Our financial performance is still not at the level we’re all aiming for,” chief executive Markus Tacke said.
Siemens merged its wind division with rival Gamesa this year following deals that saw Germany’s Nordex buy the turbine unit of Spain’s Acciona and General Electric take over Alstom Energy of France.
The overall Siemens operation is set for an overhaul in the coming year but the Munich-based group wants to limit job losses at its power generation unit.
The Munich-based group is expected to cut thousands of jobs as demand has collapsed and is unlikely to return for large turbines that have been replaced by renewable energy in Germany and beyond. The Siemens power unit reported a 41 per cent drop in orders and a worse-than-expected 23 per cent fall in profits in its fiscal third quarter that ended in June.
An unnamed manager told Reuters, Siemens could consider keeping plants open in eastern cities and towns such as Erfurt and Goerlitz in exchange for some job cuts in larger centres such as Berlin and Muehlheim in the Ruhr valley where workers have more choices.
“Maybe you have to give up a percentage point of margin to give people some perspective,” he said, adding that management and labour representatives would likely start negotiations in earnest in the second half of November.
Global demand for large gas turbines has roughly halved since 2017, Siemens estimates, while production capacity is more than three times what the market needs.
The Siemens power unit reported a 41 percent drop in orders and a worse-than-expected 23 percent fall in profits in its fiscal third quarter that ended in June.
The power division has 30,000 employees worldwide, of which about 12,000 are based in Germany.
Chief Executive Joe Kaeser has asserted that the government’s abrupt decision to switch to renewable energy caused a structural change in the industry that made the large-turbine business unsustainable in Germany.
With wind power supposedly growing at phenomenal rates worldwide, who would have thought that Siemens would be laying workers off?
Meanwhile, the Energiewende looks likely to claim another casualty in Siemens’ large turbine market.
Comments are closed.
NOT A LOT OF PEOPLE KNOW THAT 
There are no job losses at the new Siemens plant in Hull,
Siemens has a habit of closing factories when a subsidy is offered else where.
BBC in Hull come over all puppy eyes when thinking about the plant and offshore windfarms. There’s never any proper challenging.
Perhaps this portends as yet unannounced subsidy cuts for renewables across the globe.
Siemens have their ear to the ground with, not least, every senior MP in every European country. They would be inclined to ride out the storm were there more money to come from the climate change pot.
6,000 is a lot of employees. That’s very expensive in terms of severance pay, voluntary or otherwise. Not to mention equipment which is now redundant. Properties can be sold and most of the value recovered, but legal expenses etc. will make a big dent in the balance sheet.
I think this is a serious indicator of the future for renewables. Perhaps the first of many. Isn’t the biggest wind turbine manufacturer in the US? Does anyone know what their numbers are like?
No, it is the opposite:
“…as demand has collapsed and is unlikely to return for large turbines that have been replaced by renewable energy in Germany and beyond.”
“Global demand for large gas turbines has roughly halved since 2017, Siemens estimates, while production capacity is more than three times what the market needs.”
The drop in demand is for gas turbines not wind turbines.
Phoenix44
Ah! Obliged.
The key is this statement “with sales expected to dip by around a fifth in 2018.” it should be emblazoned across the headline.
One of the biggest Renewables manufacturers in the World predicts a FALL OF 20% WORLDWIDE.
That looks very much like the writing is on the wall, I doubt you will see it on the BBC.
Paul, can you change the headline?
Yes – what to?
Well before I re-read the article I was thinking of the The fall 20% World Wide, but as it is not obvious where all the sales and jobs are going from I changed my mind in my later post.
Meanwhile France looks to extend the life of it’s nuclear reactor fleet…
http://www.powerengineeringint.com/articles/2017/11/france-delays-reduction-of-nuclear-power.html
EdF has has much success extending the life of its AGRs in the UK.
Reading the whole thing again, is the Drop predicted in just their Gas Trubine sales?
Have they actuall said which sections of the Company the redundancies will occur in?
Yes, that is where the gloom and doom is, not in the wind market.
I read the article as saying 6,000 jobs to go at Siemens-Gamesa and at least the same amount at Siemens Power (Gas Turbine) division. Presumably the old Rushton/GEC/Alsthom Gas Turbines plant in Lincoln may be affected ?
Jobs there have been expanding this last year not decreasing.
Nothing found on news/twitter.
Is this the green job curse at work where real jobs making steam driven turbines for reliable 24/7 powerstations and killed off by making windmills? One green job kills off three real jobs.
If only that was what was happening – that would mean making windmills was more efficient and productive.
What Greenery does is replace one job with three because it is far less efficient and far less productive. That means we now have three people doing the work of one and two people not producing what they were previously producing.
Jobs are a cost and we want fewer people doing more: that is the way we all get wealthier.
Not really. A real job is one that is worthwhile and produces something that people want, is profitable and does not need taxpayer cash. A green job is funded by taxpayers as it produces something nobody in their right mind would want. The rising costs of the green jobs and the energy they produce drive other jobs away or bankrupts companies – South Australian plastic recycling for instance now electricity it too expensive, or Holden cars.
To quote economist Dr. Thomas Sowell of the Hoover Institution, “Reality is not optional.”
Political fantasy is colliding with commercial reality. Only one winner.
The more jobs the greens promise, the more expensive is the product.
You can just hope that the wind in some future time can compete with existing technology.