Vestas closes Chinese plant and ditches plans for UK base

Danish wind turbine maker Vestas is to close a factory in China and has scrapped plans for a manufacturing plant in the UK.

Vestas Wind Systems announced today that up to 350 jobs would be lost as a result of the closure of the Hohhot factory, which makes the company’s V52-850 and V60-850 kilowatt turbines.

Vestas said it was shutting the plant in the next few months because it predicted little growth in the kilowatt turbine sector.

“On the basis of thorough internal analyses, Vestas projects a low market demand for the kilowatt platform in the coming years,” it said in a statement, which added that the company “remains firmly committed to China and has confidence in China's long-term growth in the wind energy industry”.

Following the closure – which is expected to save $12.5m a year – Vestas will have about 2600 staff in China.

On Friday, Vestas announced it was scrapping plans for a factory at the port of Sheerness in England. The company’s original statement gave no reason for the withdrawal but it subsequently admitted it had not received a single order for the V164-7.0 MW turbines that would have been made at the plant.

“Such a factory is conditional on concrete orders in our order book and we have not announced any signed orders at this point. We want a good pipeline of orders before we advance further and we do not have that,” said a spokeman. 

Juan Araluce, chief sales officer at Vestas Wind Systems, added that the company’s “strong commitment to the development of both the offshore and onshore wind industries is not affected by this decision. We will remain active across the two markets in the UK as they both continue to show considerable potential.”

Mark Whitworth, chief executive of Peel Ports, which owns the port of Sheerness, said he was “extremely disappointed that we have been unable to conclude the agreement with Vestas”.

Maria McCaffery, chief executive of RenewableUK, was also disappointed  but stressed that the UK “remains an attractive place for manufacturers and members of the supply chain to have a base, highlighting plans by Areva for a UK factory.

On a brighter note for Vestas, the company today signed its largest ever service and maintenance renewal agreement. The deal with EDP Renováveis is to service more than 1100 turbines across 30 wind plants in the US, Spain, France, Romania, Portugal and Italy, representing a total capacity of 1897 MW.

Vestas president Ditlev Engel said the contract was “a demonstration of our customer focus, service orientation and versatility in different wind markets and site conditions”.

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