The wind industry was stunned by the Siemens Energy announcement of $1.1B in unexpected costs to correct design issues with Siemens Gamesa onshore turbines. All the OEM engineering groups are under extreme pressure to control costs while delivering exceptional turbines. Joel, Rosemary and Allen discuss the Siemens Gamesa issues and how engineering organizations can be successful in difficult times.



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Uptime 172



Allen Hall: This Week's episode of the Uptime Wind Energy Podcast is pretty exciting because Joel, Rosemary and I take a, a deep look into the Siemens Gamesa issues. Obviously, they're going through a little bit of turmoil at the moment, and. We have a discussion about what, what that means for engineering and, and for the company in, in a larger context.



The discussion is not necessarily focused on Siemens Gamesa. I think we really get into a lot of good discussion back and forth then maybe a little bit heated at times about how engineering should function. And wind turbine companies have had some real significant design issues and, and some manufacturing issues to go along with it.



Those are really tough to overcome. But Rosemary, Joel and I have worked at a lot of different companies and we've seen a lot of different engineering management styles and organizations, and we, we think sometimes those have a big influence on the quality of the product that goes out the door. So this discussion is really interesting and good.



And it, it's, it's meant to pick off a lot of discussion in the, in the industry of how to run an engineering organization, how to create a quality product. And to avoid some of the, the costly decisions that Siemens Gamesa is going through. So it's a good episode, so stick with us. I'm Allen Hall, president of Weather Lightning Tech, and I'm here with the Vice President of North American Sales for Wind Power Lab.



Joel Saxum and International renewables expert, Rosemary Barnes, and this is the Uptime Wind Energy Podcast.



So the big news this week, if you haven't seen it already, is that. Siemens Gamesa had an eternal review to look at the status of their existing onshore and offshore fleet, and during that review it was identified about $1 billion in offset, which means that they, they're gonna have to set aside about a billion dollars to take care of some of the, I think, design issues is what I'm hearing, and some manufacturing issues.



And these are just coming to light after having about a half billion dollar write down in early this year, like January, the same sort of thing had happened. Preparing for warranty claims and repairs they're gonna have to happen in the, in the near future. This, of course set Siemens stock tumbling.



About 25, 30% by the time you hear this podcast. It may have recovered some because I do think there, obviously there's value in Siemens and Siemens Gamesa but it does set everybody in the, in the wind energy space to become really concerned because you don't want to hear that a large player, such as a Siemens Gamesa, is having the stock drop and Siemens stock drop.



That kind of drop is dramatic and can. Really injure a company, not in the short term, but really in the long term. And Joel, I know the other players, the Vestas, the GEs, the Suzlons of the world didn't seem to get too rocked by that.