Siemens Gamesa closes two Spanish wind blade plants

Siemens Gamesa Renewable Energy (SGRE, Zamudio, Spain) announced on Jan. 11 its decision to close its Somozas (La Coruña) and Cuenca plants and will present a collective dismissal agreement for up to 266 employees (215 in Somozas and 51 in Cuenca).

According to SGRE, the closure of the Somozas factory is a result of a lack of orders for the SG 2.X-114 model wind turbine produced at the plant, and because it would be unable to competitively produce larger blade models demanded by the market. Specifically, the company has no confirmed orders for this blade model in Spain in 2021. As a result of stagnant demand, no plans have been enacted to use the turbine in future projects. Further, producing larger blade models at its Somozas facility is more costly than its other locations, and would be too difficult due to site and logistic constraints, says SGRE. 

In an extremely competitive repair market, SGRE says its Cuenca plant, which is exclusively focused on the repair of blades, is no longer sustainable in the long term, largely due to site constraints. The growing trend to replace blades rather than repair them has also magnified this decision.

SGRE says a collective dismissal agreement will soon be presented for up to 266 employees. Negotiations with the local workers council are intended to start in the coming days, in accordance with applicable rules and regulations.

The decision is in line with Siemens Gamesa's ongoing activities aimed at improving competitiveness, in particular in its onshore business, and delivering long-term sustainable profitability. The company will continue to shape its organization and cost base to the conditions of the global wind market, which is characterized by intense competition and price pressures that have eroded margins of wind turbine manufacturers, including Siemens Gamesa.

“We urgently need to return to the path of profitability and the only way to do it is by applying measures such as these, and those ones already carried out in our onshore business in the last year and a half,” says Siemens Gamesa’s Onshore CEO Lars Krogsgaard. “We have analyzed all the options, but concluded there is no alternative. These are tough measures, but necessary to put the company back on track and guarantee its sustainability and the employment of the more than 24,000 employees of Siemens Gamesa, around 4,400 of them in Spain. We will do our best during the negotiations with the unions to support our colleagues through this transition and minimize the impact the decision has on our employees.”