Siemens chief of wind power steps down

Source: By Catherine Green, Los Angeles Times • Posted: Tuesday, July 2, 2013

Wind turbinesSunrise behind wind turbines in California, athough these aren’t among those Siemens shut down after a blade broke in Imperial County. (Bob Chamberlin / Los Angeles Times / September 25, 2012)

Amid reports of wind turbine blades flying off and a resulting flurry of damage control measures, engineering powerhouse Siemens said Monday the chief of its wind power division would step down, two weeks after announcing costs related to incidents in California and Iowa.

In a news release, Siemens said Felix Ferlemann, 53, was leaving “by mutual agreement to pursue new career challenges.”

Markus Tacke, who had been serving as chief executive of the industrial power business unit within Siemens’ energy division, will replace Ferlemann, who became chief executive in October 2011.

“Felix Ferlemann provided essential stimuli, and we thank him for his commitment,” Michael Süß, chief executive of the company’s energy sector, said in a statement.

Siemens, based in Munich, said it would take unspecified charges for the quarter that ended Sunday after taking measures to slow rotation speeds or stop 707 wind turbines in the U.S. The move came after blade breaks were reported in California and in Iowa, most recently in May at an Imperial County wind farm. A massive blade came loose at the Ocotillo Express Wind project and landed nearby. No one was injured in the late-night incident.

Siemens said in a separate announcement June 17 it would shut down its solar energy division after failing to find a buyer since putting it up for sale in October 2012.

According to Bloomberg News, the company booked provisions in the first half of the fiscal year related to project failures in wind transmission networks and delays in train deliveries.

Siemens cut its profit target for the fourth time in six years, when Chief Executive Peter Loescher announced in May that net income could fall into the low end of its goal of 4.5 billion to 5 billion euros, or about $5.9 billion to $6.5 billion.

It earned 982 million euros (nearly $1.3 billion) in the second quarter, which ended March 31. That fell short of the 1.21 billion euros (roughly $1.6 billion) that analysts had expected. Revenue fell 6.7% to 18 billion euros ($23.5 billion).

Meanwhile, Nokia agreed Monday to buy Siemens’ half of a telecommunications equipment joint venture for 1.7 billion euros ($2.2 billion). That is “well below what an IPO or trade sale could bring in the future,” according to one analyst.

The joint venture agreement between Nokia and Siemens expired in April.

Siemens Chief Financial Officer Joe Kaeser said in a statement the deal would enable the company to focus on its “core areas of energy management, industry and infrastructure.”