by Crazy Horse
Wed Jan 7th, 2009 at 04:15:01 PM EST
In the first hard news I've seen that life will also be tough for one of the main industries which should survive well in the economic meltdown, LM Glasfiber announced up to 20% cuts in its workforce. LM is the largest independent rotor blade manufacturer around the globe. (Many manufacturers produce much of their own blades, but not all.)
Wind turbine blade producer LM Glasfiber has announced that it is to fire one fifth of its Danish workforce in what is being called the biggest domestic firing-round of recent times.
While I do believe this is a significant event, I do not believe it is strictly related to the meltdown. More below.
In a surprising announcement today, LM Glasfiber may shed up to a fifth of its workforce. The story will likely garner much press about the wind industry being slammed by the economic meltdown. It may even be jumped on by wind opponents calling many parts of the industry "not a real business." For certain, it will put some more fear into the financial industry underpinning windpower growth.
Richard Andrew Bevan, LM's general manager for northern Europe, announced yesterday that the lay-offs are a result of customers delaying windmill projects due to a lack of capital.
Of course, the potential causes will likely not be mentioned.
British private equity fund Doughty Hanson & Co. became principal shareholders in the Danish company in 2001. Four years later they cancelled plans to list LM Glasfiber on the stock exchange.
Right, LM is owned by a British private equity firm. Is it possible their growth plans were fueled more by the bubble than by sound planning, as other wind companies are doing. Certainly there are still some tough hits coming, (I won't name the high risks, except for massive consulting fees.), but could it be that this is not an example of a hit on the industry, but rather that the company set its sights too high, being managed by "private equity"?