Implications of reorganisation

The strategic reorganisation of Vestas and adjustment to the production capacity based on market dynamics imply that Vestas expects to dismiss 2,335 employees. The planned layoffs will to a large extent take place in Denmark and the rest of Europe. However, the scope of the planned reorganisation implies that several sites across the global Vestas organisation will be impacted by the planned layoffs, in particular in relation to salaried employees.

Region	Function	Salaried employees	Hourly-paid employees	Total
Europe	Staff functions, administration in Technology R&D, administrations in production units in Hammel, Lem, Varde and Ringkøbing, cease of tower manufacturing in Varde (Towers), support functions in Spain, Germany, Italy and Sweden and streamlining of Control Systems in Denmark and Spain.	1,089	660	1,749
USA	Consolidation of support functions across factories and functions.	153	29	182
China and the rest of the world	Streamlining of business and production support	358	46	404
Total planned layoff of staff (full-time employees)		1,600	735	2,335

The majority of the layoffs will take place after finalisation of negotiations with relevant employee representatives, and any plans to close down additional facilities will be decided and executed during 2012, depending on the development of the individual markets.

The implementation of the organisational change and the expected reduction in capacity will reduce Vestas’ fixed costs by more than EUR 150m, with full effect as from the end of 2012.

After implementation of the above mentioned reductions Vestas will employ around 20,400 employees.

On top of making 2,335 employees redundant in the coming months, Vestas prepares for a potential slowdown in the US market in case the PTC is not extended. This can result in layoff of an additional 1,600 employees at the US factories. The potential savings in this respect will be on top of the more than EUR 150m mentioned above.