Siemens Gamesa, the world’s second-largest wind turbine manufacturer, pulled its 2020 financial guidance on Tuesday due to the coronavirus crisis.
Siemens Gamesa said the degree of uncertainty introduced by the pandemic and the global response to it means the company cannot make predictions on its performance for this year. It will report its next quarterly results on May 6.
The move follows a similar one by market leader Vestas in early April. On Monday Vestas went a step further, announcing the elimination of 400 jobs as it streamlines its product portfolio. Siemens Gamesa underwent a reorganization in September 2019 that entailed cutting 600 jobs. Vestas let around 500 temporary workers go at around the same time.
A growing number of companies across the global renewable energy industry have pulled their financial guidance for the year, including U.S. solar players Sunrun and SunPower.
Siemens Gamesa previously disclosed the temporary closure of two facilities in Spain: a power electronics testing center in Madrid and a blade factory in Aoiz. Both sites were closed for cleaning after a positive COVID-19 case was identified in each.
The impact of India's COVID-19 lockdown
In a statement announcing the decision to withdraw results, Siemens Gamesa appears to have confirmed that its factories in India are now closed.
“Since the crisis started earlier in the year, SGRE has devoted significant resources to mitigating the impact of disruption in our factories and facilities across the world, first in China and then in other markets including Spain and India where we complied with government-mandated closures," the company said in a statement.
“Our Chinese factories began to return to regular operations from the end of March, and we have now been able to resume operations in Spain and are working closely with other governments to enable us to do so elsewhere,” the statement continued.
When the virus was only impacting China, Siemens Gamesa’s Indian footprint was an advantage. Now, as China reopens, the near month-long shutdown in India is having an impact.
Prime Minister Modi has only just begun to allow some factories to reopen this week. In Europe, wind power factories are largely open but with social distancing and new work patterns in place to protect employees.
Blade pain sharpened by the coronavirus pandemic
The wind industry was already strained on supplies of blades amid shortages of balsa wood, a key component material.
Ecuador produces 90 percent of the world’s supply but suffered a poor harvest that was impacted by very wet conditions. On March 15, Ecuador banned all planes and ships from entering the country as it looked to get ahead of the spread of COVID-19. Papua New Guinea, an emerging source of balsa supply to the wind industry, is also on lockdown, said Shashi Barla, Wood Mackenzie's principal analyst for the global wind supply chain.
For Siemens Gamesa, around 20 percent of its blade production is based in India, said Barla, exacerbating what was already a challenging situation.