A 2.37-megawatt Siemens wind turbine is shown at the Ocotillo Wind Energy Facility in California, May 29, 2020.
Ping Guan | Reuters
German renewable energy company Siemens Energy announced on Wednesday that the CEO of its struggling wind turbine unit will be replaced amid “comprehensive restructuring measures.”
Siemens Gamesa's Jochen Eckholt has informed the board that he will step down from his position as CEO by mutual agreement on July 31, and will be succeeded by Vinod Philipp, it said in a statement.
“In a very difficult situation at Siemens Gamesa, Jochen laid the central foundations for a much-needed reorganization and fresh start within Siemens Energy. It is fair to emphasize that the causes of the quality problems did not fall within his period as CEO.” Christian Brock, CEO of Siemens Energy, said in a statement.
She said Gamesa had initiated comprehensive restructuring measures and “long-term strategic development steps” in order to boost operating margins.
Siemens Energy has had a difficult 2023. Problems with manufacturing defects at Gamesa forced the parent company to lose 4.6 billion euros for the financial year. An investigation has been launched into quality issues in the wind turbine division.
In June, amid a particularly turbulent period for the stock, Siemens Energy scrapped its earnings forecast and warned that costly failures at Gamesa could continue for years.
The wind power industry has expanded rapidly over the past two decades, bringing costs down to rival – and sometimes undercutting – those of fossil fuels, while boosting efficiency with ever-larger turbines and reducing reliance on government subsidies. But problems last year have investors concerned that Gamesa's problems may be a symptom of a broader problem facing the industry.
Meanwhile, Siemens Energy on Wednesday reported net income of 108 million euros ($116 million) for the fourth quarter and raised its forecast for “stronger growth and positive cash development.”
CNBC's Elliott contributed to this article.
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