General Electric fires wind energy department employees

General Electric Co. is laying off staff at its onshore wind power plant within a plan to restructure and reshape the enterprise that is struggling with weak demand, mounting costs, as well as supply-chain delays.

Sources reported the corporation on Wednesday informed its employees from North America, the Middle East, Latin America and Africa about their layoffs. Plans also include reducing the workers’ amount at onshore wind plants in Europe and Asia-Pacific.

The cuts are likely to affect 20% of the labor force in the U.S. sector. More than a hundred workers would be touched by these measures. 

“This is a tough call having no bearing on our staff’s dedication and persistent work. But it must be made in order for the business to compete and increase profitability over time," said a GE Renewables spokesman.

Onshore wind is considered the biggest of GE’s renewable enterprises, with 38,000 persons hired globally at the end of 2021. However, this division is struggling with higher raw material expenses as a result of inflation and production-chain pressures.

The U.S. being GE's most lucrative onshore wind market, witnessed political turbulence, along with the tax credit for renewable power generation expired last year. These turmoils have struck consumer demand, causing division revenues to fall in 2022.

Greater competition, supply shortages amid the COVID-19 pandemic and rising metal prices have hindered a profit-making process for wind turbine manufacturers. That happened despite the government and enterprises invoking more renewable energy due to climate change.

Issues at GE's onshore wind division that represented 15% of the corporation's industrial sales last year, have negative effects on business performance in a renewable energy sector. As for mid-summer, the enterprise accused its North American onshore division for  profit falling by two-thirds during the second quarter. 

Tax credits for wind power projects, possibly being restored, could spur demand in North America. Meanwhile, analysts speculate on international sales of GE's onshore wind division to remain in question considering the unit's high costs.