Vestas to close China plant, cut 300-350 jobs

Reuters • Posted: Monday, June 25, 2012

COPENHAGEN, June 25 (Reuters) – Danish wind turbine manufacturer Vestas Wind Systems said on Monday it will close a factory in China and cut 300-350 jobs in the process, due to forecast low demand for kilowatt turbines in the future.

The world’s biggest wind turbine manufacturer said it would phase out production of kilowatt turbines, including the V52-850 kilowatt and V60-850 kilowatt turbines produced at the Hohhot factory to be closed.

“On the basis of thorough internal analyses, Vestas projects a low market demand for the kilowatt platform in the coming years,” the company said in a statement.

Closing production at the factory will occur over the summer and will lead to annual savings of around 10 million euros ($12.5 million), Vestas said.

The cost of closing the factory would be covered by the 2012 guidance for special items of 50-100 million euros, it said, adding its commitment in the country was intact.

“Vestas remains firmly committed to China and has confidence in China’s long-term growth in the wind energy industry,” the company said in the statement.

After the closure of the Hohhot factory, Vestas would have about 2,600 employees in China, spread across two production bases in Tianjin and Xuzhou and two offices in Beijing and Shanghai, respectively.

The company would continue to offer service solutions to the owners and operators of the kilowatt turbines, it said in the statement.

On Friday, Vestas said it had dropped plans to build a wind turbine factory in Britain which would have created 2,000 direct and indirect jobs.

The company said it did not wish to go into further detail regarding reasons behind the decision, but confirmed it had received no orders for turbines meant to be produced at the site.