Vestas layoffs starting to add up

Vestas Wind Systems had its third layoff at its Colorado facilities in recent weeks as it awaits action on the federal production tax credit that appears to be stalled until after the election.

Vestas cut about 30 workers at one of its Brighton plants that manufacture wind turbine nacelles, bringing the workforce to 200. The cuts follow 90 positions that were eliminated last week at its tower manufacturing plant in Pueblo.

Earlier this year CEO Ditlev Engel said the company could eliminate as many as 1,600 jobs at its four Colorado plants. Congress has not renewed the key wind subsidy, the production tax credit (PTC) and the industry has reported order books for next year have been emptied as developers cope with uncertainty and projects are delayed or cancelled.

It’s not just in the U.S. Vestas this week announced even more aggressive steps to cut losses in its worldwide operations by accelerating planned layoffs in Europe.

“Decisions regarding the exact number of jobs that could potentially be affected in the U.S. and where they are located remain undecided. However, we will continue to scale our business up or down depending on business needs and market demands. We are committed to the North American market, but we also need to be flexible to adapt to changing market demands,” company Spokesman Andrew Longeteig said.

“As Engel said in the Q2 earnings announcement, decisions regarding manufacturing jobs in the U.S. will be made later in the year,” Longeteig continued. “In the meantime, our factories in Colorado will continue to produce products at the levels we need them to, based on customer needs, and they will continue to export product to Canada, Mexico and Central and South America.”

Vestas had previously announced the workforce would be reduced by 2.335 by the end of 2012, these reductions are ahead of schedule. The company said to reach that number 1.100 employees would instead be laid off by the end of September 2012. Worldwide employment would be reduced to around 19.000 by the end of 2012.

 “The further reduction in the workforce is part of the continued cost saving plans which Vestas has been working on since November 2011,” he says. “It is always unfortunate to have to say goodbye to good colleagues in Vestas, but we have said before that 2012 will be tough and 2013 will be even tougher for Vestas, and in order to reach our target of making 2013 profitable, it is unfortunately a necessity.”

Sen. Mark Udall (D-Colo.), a vocal PTC champion, said the bad news was expected due to Congressional inaction. “Americans are losing their jobs and our nation is at risk of losing its edge because Congress refuses to extend the wind Production Tax Credit. Enough is enough: Congress needs to extend the PTC and support Made-in-America energy and good-paying manufacturing jobs,” Udall said. “I fear that Vestas’s layoff announcements this week are only the beginning if Congress does not extend the PTC ASAP. I plan to take the stories of the workers in Pueblo, Brighton and other cities across Colorado back to Washington to continue to make the case for the PTC.”