Siemens Wind Power Ltd., as part of Siemens Gamesa Renewable Energy, has decided to close its wind blade manufacturing plant in Tillsonburg, Ontario, by early 2018.
The closure, affecting 340 employees, will be conducted in phases through the rest of the calendar year, the company says.
“This was a very difficult decision that was taken only after assessing all the options,” states David Hickey, head of the Siemens Gamesa business in Canada. “We have a great team of employees at the plant who have produced quality work for the last six years, and we sincerely appreciate all their efforts. However, the harsh reality is that in order to remain competitive, we must constantly evaluate our global manufacturing footprint. ”
According to the company, the decision to close the plant comes as a result of significant changes in the global and regional markets, combined with physical limitations at the existing plant. For example, the global market has become increasingly competitive; the market in eastern Canada has experienced a significant reduction in demand for blades in the last year; and the export market into the U.S. has been delayed due to a combination of factors, including uncertainty around U.S. tax policy, Siemens Gamesa says.
In addition, according to the company, today’s market environment requires significantly larger blades, a critical requirement for the business to remain globally competitive. However, the Tillsonburg factory cannot easily be adapted to manufacture this product portfolio, and the significant investments necessary to bring the plant in line with current market requirements would result in costs that could not be competitive in the global markets, explains Siemens Gamesa.
“Our focus at this point is on the employees affected by this announcement,” adds Hickey. “In addition to their severance packages, we will be providing all affected employees with career counseling, job-placement assistance – including resume preparation – and redeployment where possible.”
The plant began commercial operation in 2011 to provide wind blades for projects in Ontario and beyond. Since then, the plant has produced more than 2,500 blades and supported projects in Ontario, Quebec, the U.S., the U.K. and Sweden.