Siemens Energy Seeks German Government Guarantees Amid Financial Struggles, Shares Slightly Recover After Significant Fall

Siemens Energy is requesting state support of up to €16 billion ($16.9 billion) for long-term future projects amid concerns of financial instability, as issues in its wind power subsidiary cause a significant drop in market capitalization.

Siemens Energy, a major European manufacturer of wind farms, power grids, and natural gas turbines, is requesting state support from the German government of up to €16 billion ($16.9 billion) to facilitate long-term future projects.
Siemens Energy's market value suffered a significant hit due to setbacks in its wind power subsidiary, Siemens Gamesa, causing the company's shares to plunge. However, shares made a partial recovery, rising by 4% after news broke about the potential state guarantees.
Siemens Energy's problems originated from quality issues with rotor blades and gears in newer onshore wind turbines from Siemens Gamesa, leading to billions in losses and potential repair costs over several years.
Despite the losses, the company reported a strong growth in order intake and currently holds €110 billion worth of orders on its books. Key projects include building of transmission networks, gas turbines and large-scale wind farms.
Siemens Energy's financial troubles could signal growing instability in the renewable energy equipment manufacturing sector, raising concerns about the pace at which economies can transition to cleaner energy.