Market condition

Siemens Gamesa closes Navarro plant in difficult market context

Siemens Gamesa has decided to close its factory in Navarro, which is not competitive in the market environment to produce blades for large turbine models.

Siemens Gamesa Renewable Energy, one of the world’s leading suppliers of wind turbines, has announced that the company has to adapt to the difficult market conditions in the wind industry, characterized by strong competition and price pressures that have deteriorated the margins of wind turbine manufacturers. To succeed in this environment and increase the competitiveness of its onshore operations, the company will focus on the next generation of large turbines, with rotors up to 170 meters. These models already represent almost half of current demand and are crucial to increasing profitability and further lowering the cost of clean energy. To successfully advance this strategy, Siemens Gamesa has decided to close its factory in Aoiz, which is not competitive in the market environment to produce blades for large turbine models.

The Navarre plant manufactures SG 3.4-132 for projects located mainly in Spain. Its higher costs and its geographical position, more than 200 km from the nearest port, make it uncompetitive in world markets.

The company has announced that it will initiate a collective dismissal procedure for a maximum of 239 employees. Negotiations with the local works council should start in the coming days, in accordance with the applicable rules and regulations. Information on final agreements will be communicated once negotiations are completed.

“We are making a difficult decision and I am fully aware of the impact this will have on some of our employees as well as on the local community. We will do our best to support our colleagues in this transition ”, explained Alfonso Faubel, Onshore CEO of Siemens Gamesa. “We do not take decisions with such a serious impact lightly and over the past few months we have carefully considered all the options available to us and reluctantly concluded that there is no alternative to this. action. In the current circumstances, we have the obligation to adopt the necessary measures to ensure the sustainability of this company and the jobs of more than 24,000 colleagues around the world, including nearly 5,000 in Spain ”, he said. added.

The company said that while this activity is not directly linked to the COVID-19 crisis, the effects of the pandemic on the operations and business activity of Siemens Gamesa have heightened the need for action. The company reported a direct impact of 56 million euros on its profitability during the last quarter.

“Spain will remain the country with the largest manufacturing footprint for us. In addition, we are strengthening our R&D activities, which are less exposed to temporary market conditions, and in the last two years we have hired more than 450 employees in Navarre and the Basque Country. Finally, the proximity of Spanish suppliers to our onshore R&D hub represents a great opportunity for them. In 2019, we bought more than 1.2 billion euros from Spanish suppliers, ”concluded Faubel.