REpower Systems SE, a German unit of India’s biggest wind-turbine maker Suzlon Energy Ltd. (SUEL), will cut as many as 750 jobs to reduce costs and prepare the company for the wind industry’s “volatile” mid-term outlook.
REpower, based in Hamburg, seeks to save about 100 million euros ($130 million) in the 2013-2014 financial year, it said today in an e-mailed statement. The manufacturer, with 3,300 employees worldwide, seeks to keep compulsory departures to a minimum by offering incentives for contract-termination agreements and letting fixed-term contracts expire, it said.
“We will apply leverage wherever we have recognized need for action and will be able to realize savings potential for example in purchasing, production or manufacturing,” REpower Chief Executive Officer Andreas Nauen said in the statement.
Wind turbine makers led by General Electric Co (GE:US), Vestas Wind Systems A/S (VWS) and Siemens AG (SIE) face narrowing margins after they reduced prices to compete for orders as European governments cut clean-energy incentives to curb budget deficits. Cost cuts may stop the trend. Xinjiang Goldwind Science & Technology Co., China’s biggest maker of wind turbines, yesterday said its first-quarter profit increased fivefold as cost reductions countered a decline in sales.
“Whilst the long-term outlook for the sector remains strong, the mid-term outlook is expected to remain uncertain and volatile, and we need to prepare for that,” Nauen said.
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