Vestas to cut over 2000 jobs after profits slump

Denmark-based wind turbine maker Vestas Wind Systems A/S has announced 2335 job cuts in a bid to restore its profitability after rising costs hit its 2011 earnings.

The cuts are equivalent to around 10% of its workforce and would reduce its costs by more than EUR150m (US$190.3m) by year-end. In addition, if a tax credit for renewable energy is not restore in the US, a further, US-based 1600 jobs would follow.

The world’s no. 1 wind turbine maker faces the challenges of renewable energy subsidy cuts by hard-pressed governments worldwide as well as stiff competition from countries such as China.

Late in 2011, Vestas was hit by cost overruns in product development and delayed revenues which last week forced it to issue its second profit warning in just three months.