Stockbrokers are shocked
Defects in wind turbines: Siemens Energy collects profit forecast
6/22/2023 at 9:34 p.m
The problems at the wind turbine manufacturer Siemens Gamesa do not stop. The parent company is withdrawing its profit forecast due to quality defects in onshore wind farms. The failure rates of wind turbine components are higher than expected.
The technical problems in the wind power business of the Munich energy technology group Siemens Energy are apparently more profound and expensive than expected. Siemens Energy conceded that some components of Siemens Gamesa’s wind turbines had “significantly increased” failure rates. Now all installed wind turbines would be checked. Repairing them or replacing parts is expected to cost billions.
Most recently, Gamesa had set aside almost half a billion euros for warranty and maintenance costs. The profit forecast for Siemens Energy is therefore no longer tenable. The Munich-based group had already expected a net loss of more than 800 million euros for 2022/23 (end of September).
“The current status of the technical review suggests that achieving the targeted product quality for certain onshore platforms will incur significantly higher costs than previously assumed,” the statement said. The hoped-for improvements in productivity at Siemens Gamesa also fell short of expectations.
Business with wind turbines on the high seas is also bumpy: “In addition, we continue to see difficulties in ramping up production capacities in the offshore sector,” explained Siemens Energy. Stockbrokers reacted in shock. The Siemens Energy share listed in the leading index DAX, which was close to its high for the year, collapsed in late trading by 11.4 percent to 20.35 euros.
Rehabilitator blows wind in your face
At Siemens Energy, too, fundamental questions are now being asked about how to proceed with the problem child from Spain. You review “the key assumptions underlying the business plans.” What that means financially is not yet clear. Siemens Energy boss Christian Bruch had recently hoped for a turn for the better at the wind energy subsidiary. Siemens Gamesa is benefiting from the energy transition: “Prices have developed well.” Bruch said in May that he assumes that this will continue.
Siemens Gamesa, one of the world’s largest manufacturers of wind turbines, has kept the group in suspense for years. The Spaniards Siemens Energy repeatedly put a spanner in the works. After all, the reorganizer Jochen Eickholt, sent from Munich, should clean up at Gamesa and stabilize the Spanish company. But the wind is blowing in his face too.