Vestas stops projects and cuts jobs in virus response
Vestas is stopping projects, axing jobs and cutting salaries of executive management by 10% in response to Covid-19. “We’re in a period of high uncertainty and by making a strategic decision on our product portfolio and reduce complexity, we sustain our competitiveness”, says CEO Henrik Andersen.
The Danish wind turbine manufacturer has announced that it will optimise parts of its product portfolio, which includes stopping certain projects with immediate effect. The company will focus on executing its order backlog and customer commitments in 2020 “as strongly as possible.”
To strengthen its financial position, the workforce that does not directly support 2020 deliveries will be reduced. Vestas will layoff 400 employees, primarily in the facilities in Aarhus and Lem but a limited number of layoffs in other locations in Europe is also expected. Additionally, Vestas’ directors in Executive Management will take a 10% pay-cut until the end of 2020.
The layoffs are expected to affect most Vestas locations in Denmark with the majority in Aarhus and Lem, due to technology projects driven from those locations being stopped. Vestas’ temporary facility in Viborg, which was established to serve specific projects from MHI Vestas Offshore Wind, will be closed.
“It’s always difficult to say goodbye to good colleagues and the timing for these decisions is never good, but our responsibility is to strengthen Vestas for long-term success”, says Andersen. “By making Vestas and wind energy more competitive, we want to provide the solutions that make the energy transition an integral part of rebuilding societies and economies, and ultimately creating jobs across the value chain”.
Following the announcement, Vestas employs more than 25,500 people globally and around 4,000 in Denmark.