GE Vernova May Cut 900 Offshore Wind Jobs as It Scales Back

The company, a spinoff from General Electric, has been plagued by financial losses in its wind unit and, more recently, accidents involving the failure of turbine blades.

The energy company GE Vernova said on Friday that it would pare back its troubled offshore wind business, which has been hit with financial losses and accidents. The changes, which are aimed at coping with a difficult environment for the wind industry, could result in around 900 job losses.

The company’s struggles are a blow to the offshore wind industry, which is a major source of electric power in northern Europe and is thought to have potential to supply large volumes of green energy to the East Coast of the United States.

A substantial downsizing of GE Vernova would leave just two main western players, Siemens Gamesa of Germany and Vestas Wind Systems of Demark — a situation that could leave the industry short of construction capacity and could push equipment prices higher, raising consumers’ bills.

GE Vernova, a spinoff from the venerable General Electric industrial conglomerate, said it had presented a proposal on Thursday for reducing the company’s size to its European Works Council, which represents its workers, a necessary step before job cuts.

The company said in an emailed statement that its new plan reflected “industrywide challenges for wind” and aimed to create “a smaller, leaner and more profitable business.”

The company declined to specify which countries’ operations would be hit hardest, but it has a large turbine factory in Saint-Nazaire, France, near the mouth of the Loire River.

A leader in land-based wind turbines, especially in the United States, GE Vernova hustled to develop a giant turbine called the Haliade-X for offshore deployment, spending $400 million.

GE Vernova may also want to focus its offshore wind business on North America, some analysts say.

The machine, which has blades more than 300 feet long, was for a time the leader in the race to build the most powerful turbine, but GE Vernova’s offshore unit has so far been a money loser, dragging the overall wind business down.

On Sept. 12, GE Vernova said it expected to lose $300 million in its wind business in the third quarter.

A surge in inflation after the pandemic has pushed up costs substantially in the industry, leaving GE Vernova stuck with commitments to supply offshore turbines on terms that have translated into losses.

Adding to the woes, a monster Haliade-X blade failed in July on Vineyard Wind 1, a $4 billion facility off the coast of Massachusetts that was to be the first commercial-scale wind farm in U.S. waters.

Jagged pieces of fiber glass from the shattered blade washed up on shores in Nantucket, leading officials to briefly close beaches to swimmers and rekindling criticism from the fishing industry and other groups. Federal regulators halted work on the project before easing restrictions in August.

Two more GE Vernova blades failed at Dogger Bank, a large wind farm being built off eastern England, in May and August.

GE Vernova insists that these accidents were not the result of a major design flaw. It blamed the Vineyard Wind 1 failure on what it called a “manufacturing deviation” at a factory in Gaspé, Quebec, and said the two other collapses stemmed from errors that occurred during installation and startup of the turbines rather than defects in the blades themselves.

Regardless of the cause, the failures led to costly delays during the summer, when the maritime weather is most suitable for construction. “We have had a tough couple of months,” the company’s chief executive, Scott L. Strazik, said on Sept. 12 at an investor conference.

The accidents suggest that offshore wind may be a riskier, less predictable industry than was previously thought. Shallow coastal waters are “obviously a good place for wind; that is why they do it” in those areas, Andrew Kaplowitz, an analyst at Citigroup, said in a recent interview. “But it does seem like conditions can be a bit more variable.”

Explore Our Business and Tech Coverage

Dive deeper into the people, issues and trends shaping the worlds of business and technology.

• Jony Ive After Apple: Five years after leaving the company, the iPhone designer is forging a new life in San Francisco, one imaginative building at a time.
• The Birkin Bag of the Book World: Assouline has made its name publishing tomes that sell for $1,000 or more. But that’s just the beginning of this family-run company’s ambitions.
• Fueling Trump’s Rise: The producers of “The Apprentice” crafted a TV version of Donald Trump — measured, thoughtful and endlessly wealthy — that ultimately paved his path to the White House.
• Elon Musk’s Security Apparatus: As threats to his safety have become graver, the world’s richest man has barricaded himself behind a phalanx of bodyguards that operates like a mini-Secret Service.
• The Crackup of Red Lobster: Here’s how missed opportunities, a $1.5 billion real estate deal, all-you-can-eat shrimp and the global pandemic sank America’s largest seafood chain.