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MarketScreener Homepage  >  Equities  >  Xetra  >  Siemens AG    SIE   DE0007236101


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Vestas To Make More Products for other Wind Companies -Operating Chief

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01/17/2013 | 11:35am EDT
   By Katarina Gustafsson 

Struggling wind turbine maker Vestas Wind Systems A/S (VWS.KO) is looking to fill more idle factory space by making products for other wind power companies, its Chief Operating Officer Jean-Marc Lechene said Thursday.

The Danish company earlier this week secured a deal, with an undisclosed party and for an undisclosed figure, enabling it to ramp up production at its Pueblo, Colorado, plant. Vestas said it will hire 100 people at the facility as it begins manufacturing the first part of a supply agreement for wind power towers.

And it is now hoping to sign similar deals elsewhere.

"We are discussing [potential contracts] not only in North America, but also in China and in Europe as well," Mr. Lechene said during a telephone interview with Dow Jones Newswires.

The executive said the discussions not only focus on building towers for other companies in the sector, but could also relate to other components used in the wind power industry, adding the company has already received some smaller orders for other components in Europe.

Vestas has plants in North America, Europe, China and India and Mr. Lechene said it started looking at this production strategy some three to four months ago in an attempt to better utilize its staff and equipment.

"We thought that we could perhaps supply parts to other players in the wind industry so we initiated some discussion, some talks and some contacts," said Mr. Lechene.

Vestas isn't seeking to add a specific level of volumes or additional employment through these deals. "This is more cherry on the cake," he said.

Vestas earlier this month received final approval for a revised credit package with its lenders in a rare bright spot for the company. The package came after a turbulent couple of years during which it has reported steep losses, implemented management shakeups and cut jobs.

Once the recipient of subsidy-fueled growth, Vestas and its competitors, like Germany's Siemens AG (>> Siemens AG), have struggled with excess capacity and low-cost rivals from Asia.

In positive news for wind power companies, the U.S. Congress at the start of the year renewed subsidies for wind power companies, the so-called production tax credit, or PTC. Mr. Lechene said it is difficult to judge whether the extension of the tax credit deal helped it secure the Colorado deal.

"It is difficult to say, we initiated discussions before the PTC was renewed. The deal was signed after it was approved but I think it's somehow independent."

Write to Katarina Gustafsson at katarina.gustafsson@dowjones.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

Stocks mentioned in the article : Siemens AG
Stocks mentioned in the article
ChangeLast1st jan.
ONE STOP SYSTEMS, INC. -3.31% 1.46 Delayed Quote.-27.72%
PTC INC. 0.44% 59.27 Delayed Quote.-20.86%
SIEMENS AG 3.17% 75.26 Delayed Quote.-35.42%
VESTAS WIND SYSTEMS A/S -1.31% 72.42 Delayed Quote.-20.37%
VESTAS WIND SYSTEMS A/S -0.80% 544.6 Delayed Quote.-18.45%
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