German government rescues Siemens Energy

GERMANY’S government announced a €15 billion rescue package including €7.5 billion in state guarantees for windfarm manufacturer Siemens Energy.

The company employs around 26,000 people inside the country and although the ailing company has €110 billion in orders it requires help to sustain them.

The move also affects Spain as Siemens Energy’s subsidiary, Siemens Gamesa,  is one of the world’s leading wind turbine makers.  Headquartered in Zamudia (Vizcaya), the company has nine factories that provide jobs for 4,600 people.

The subsidiary, which has large operations in Denmark as well as Spain, has had major problems with some of the turbines it supplies, involving failures in the enormous blades that have led to high repair costs.  Siemens Gamesa has also been hampered by deals agreed in the past at prices that were subsequently affected by galloping inflation.

Siemens Energy took over Gamesa in December last year after acquiring the remaining third of the shares which it did not already control.

Spain’s Industry, Commerce and Tourism ministry announced on November 14 that the government was also working on a possible series of guarantees for new international contracts.

After approximately 40 years of uninterrupted profits, the Basque company lost €630 million in 2021 and by 2022 registered its worst-ever losses of €940 million.

“The future of Siemens Gamesa in Spain is a priority for the Spanish government,” the ministry announced on November 14, adding that it was in “continuous contact” with the unions in order to protect jobs and production capacities.