It is not an easy time for Siemens Energy. The German energy company has fallen into very serious trouble, teetering on the brink of collapse.
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At Automation Trader, we have devoted considerable space to energy issues over the past year. We have invited eminent experts into the studio to reveal the secrets of the transition, the EU directives awaiting companies and ordinary citizens, or what the famous carbon footprint is.
Winds of change
Not so long ago it seemed that the energy sector would only go from strength to strength, but since the Russian aggression in Ukraine began, things have not been so good.
The best indication of this is precisely the fact that a giant such as Siemens Energy has fallen into serious trouble. The company, which is part of the Siemens AG group of companies, has been bringing its shareholders nothing but headaches for many months, and all because of... the wind.
Or rather - if we are to be precise - the Spanish subsidiary that deals with wind energy. Siemens Games got into serious trouble because of faulty turbine designs, which in turn translated into a whole host of technical problems. All of this ultimately came down to Siemens Energy's record losses.
State drip
The €4.6 billion loss cast doubt on the company's continued existence. The matter began to get serious enough that politicians had to get into the game. The Germans decided to hook Siemens Energy up to a financial drip of €7.5 billion, but it is already known that the federal government has envisaged total aid of as much as €15 billion.
As you might have guessed, such an action has caused quite a storm. How can a private company be kept alive with public funds? What about the free market and the principles of fair competition? To date, these voices have remained unanswered.
Interestingly, Siemens Energy has set an infamous record. Indeed, no other DAX-listed entity has brought greater losses to its investors since 2008. But will this ultimately lead to the dismissal of the board of directors and major changes in the company's structure? The chances of this are slim.
As reported in the German media, investors do not agree on the discharge of the board of directors, however, the German Association for the Protection of Securities Deutche, among others, is much more optimistic on the subject.
Is there really reason to look to the future in colourful hues? Possibly, as evidenced for example by the Siemens Games contract for the supply of new wind turbines, which amounts to almost EUR 2 billion.
