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Offshore Wind Turbine Builder Vestas Closes Three Factories

THE MARITIME EXECUTIVE

After reporting mixed financial results in the second quarter, with rising revenue but slim margins, wind turbine manufacturer Vestas has announced that it is closing three of its factories in Europe, including a facility that makes power components for one of its largest offshore models.

Vestas is the leading manufacturer in the onshore wind turbine market, and it has a portfolio of offshore turbine models as well, including a new 15 GW giant with the largest swept area in the industry. Scale is key in offshore wind project developments, and Vestas' leap forward from 9.5 to 15 GW at the high end of its range will help it to keep pace with competitor Siemens Gamesa and GE, which have recently boosted the top end of their respective lineups to 14 GW.

Vestas’ factory in Esbjerg, Denmark makes power conversion modules for two previous generations of offshore wind turbine, the V164 and the 9.5 GW V174. The factory employs about 75 people, and it is on the list for closure. "As demand for these modules will gradually shift to markets primarily outside of Europe and be delivered via more localized manufacturing facilities, Vestas expects to conclude production of power conversion modules in Esbjerg during the first half of 2022," the company said. 

Vestas said that it will look for opportunities to relocate the staff currently working at its factory in Esbjerg to other sites in Denmark, where it has a total of nearly 6,000 employees. 

In Spain, Vestas will be closing a factory that makes control panels for the V164 offshore turbine and generators for its smaller 2 MW onshore turbines. Demand for the 2 MW platform is falling, Vestas will close its factory in Viviero and offer opportunities to employees to relocate to other sites; about 115 personnel will be affected. 

In Germany, Vestas is planning to sunset its factory in Lauchhammer, which makes a limited number of turbine blades for its V117 and V136 series. The company expects to make enough blades for these models using supply from its other factories around the world. The expectation is to end production in Lauchhammer by the end of 2021, and about 460 people will be affected. As elsewhere, Vestas will work to find new opportunities for employees who are displaced by the closure. 

"Today’s fast-moving energy transition, rapid introduction of new products and recent integration of our onshore and offshore business require us to further mature and evolve our supply chain network and manufacturing footprint," said COO and EVP Tommy Rahbek Nielsen. "I would like to emphasise that we are deeply committed to explore opportunities to relocate our colleagues, who unfortunately will be impacted by the cease of production at our factories in Lauchhammer, Viveiro and Esbjerg."