Siemens’ Strategic Development Within the Wind Turbine Industry

Siemens’ Strategic Development within the Wind Turbine Industry

SIEMENS
By M. Alihodzic & T. Dewilde

Thibaut Dewilde 20097399 Mersad Alihodzic 20022683

Siemens’ Strategic Development within the Wind Turbine Industry
Transnational Management (4847) Mikael Søndergaard Thomas Stephansen

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Siemens’ Strategic Development within the Wind Turbine Industry

SIEMENS
By M. Alihodzic & T. Dewilde

Table of Content I. Introduction ..................................................................................................................................................... 3 II. 1) 2) 3) 4) 5) 6) III. 1) 2) a) b) 3) 4) a) b) c) 5) 6) IV. 1) a) b) V. 1) a) 2) 3) VI. VII. VIII. IX. X. Historical Context and Current Situation of the Company ............................................................................... 3 The Birth of a Global Player ....................................................................................................................... 3 The Reform ................................................................................................................................................ 3 A Transnational Company .......................................................................................................................... 5 Siemens’ Current Global Strategy, Values and Image Branding ................................................................ 5 Siemens in China ....................................................................................................................................... 6 Siemens in the US ...................................................................................................................................... 7 The Wind Turbine Industry ......................................................................................................................... 8 General Facts and Development ................................................................................................................ 8 The State of Competition .......................................................................................................................... 11 Competition with Other Renewable Energies ....................................................................................... 11 Competition within the Wind Turbine Industry ...................................................................................... 12 The Offshore Sector ................................................................................................................................. 14 The Chinese Market ................................................................................................................................. 14 Growth and Market Drivers .................................................................................................................. 14 Competition .......................................................................................................................................... 15 A Specificity of the Wind Turbine Industry that Changes the Usual Expectations ................................ 16 The American Market ............................................................................................................................... 17 The European Market ............................................................................................................................... 18 Siemens in the Wind Turbine Industry ...................................................................................................... 19 Achievements, Experience and Outcomes ............................................................................................... 19 On the offshore market ........................................................................................................................ 20 In a more general way.......................................................................................................................... 22

Entering Foreign Markets.............................................................................................................................. 24 Strategic Alliances .................................................................................................................................... 24 Joint-Ventures ...................................................................................................................................... 26 Risks of collaborating ............................................................................................................................... 26 Foreign Direct Investments and Acquisitions ............................................................................................ 27 Strategic Planning .................................................................................................................................... 28 Siemens’s Strategic Decision ................................................................................................................... 29 Conclusion ................................................................................................................................................ 33 Appendix .................................................................................................................................................. 34 References ................................................................................................................................................... 36

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Siemens’ Strategic Development within the Wind Turbine Industry

SIEMENS
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I.

Introduction

The wind turbine industry is witnessing a tremendous expansion these last years and it will keep growing fast the next decades. It represents a huge business for which numerous companies are fighting. The degree of competition is very high and it forces companies to be on the cutting edge in order to remain competitive. Strategic decisions are crucial for companies to survive and expand in such a competitive market. This paper summarizes the current situation of the wind industry market, Siemens ‘current position within the industry and it tries to assess what should the company do in order to strengthen its position in this field. A first part will be dedicated to a presentation of Siemens itself in order to understand the companies values, guidelines and strategies. Thereafter, a comprehensive study of the global market including a breakdown per continent will follow and will aim at easing the strategic decisional process afterwards. Eventually, the last section will be devoted to the strategic recommendations we formulated for Siemens.

II.

Historical Context and Current Situation of the Company

1) The Birth of a Global Player

Siemens was created in 1847 in Germany by Werner von Siemens. They began operations with telegraphic systems and expanded rapidly all over Europe as well as the US through their London branch. Throughout time, Siemens has been a leader in many different fields of activities such as telecommunications, medical technologies, manufacturing of heavy industry equipment and nuclear plants installations among others. Back in 2000, Siemens was one of the top five companies in electronics and electrical engineering companies in the world; employing not less than 480,000 people around the globe with record annual sales of more than € 130 billion.

2) The Reform

One main aspect of Siemens’ history that is to be examined to understand the company’s philosophy is the radical change in strategy they undertook.

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Originally and until the 90’s, Siemens’ strategy had been qualified as the “second is best” strategy; arguing that it was better to have a highly diversified portfolio even though being number two in each field of activities. Another particularity of their expansion strategy was the absence of strong marketing campaign. Siemens was working on the basis of a high technological competence and proficiency while at the same time being close to large customers. They also developed the financial division of the group to help customers financing their projects. However, as from the 90’s, a high wave of deregulation made competition fiercer and force the German firm to revise its traditional strategic development. A new CEO, Heinrich Von Pierer, took office in the mid-90’s and brought about a brand new US management style. He implemented a massive plan aimed at restructuring the company. This plan allowed Siemens to get rid of the bad-performing units while favoring the remaining businesses that were outstandingly doing well and to make sure they become number one in their respective fields. These measures also included to cut the high-cost of German workforce by more than one third, the reduction of overtime pay and finally the adoption of US accounting systems, all leading to more flexibility. Their policy is nowadays to be the uncontested number one in every field of activity they are operating in and their marketing is based on offering strictly higher quality and service than competitors. As a result, at the present time a bit more than 400,000 persons are working for the German firm, with a 2009 annual revenues of roughly € 75 billion. The company has a worldwide presence with operations in more than 190 countries in 1640 different locations among which 176 are R&D facilities.

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3) A Transnational Company

A transnational company is usually described as the most complex type of organization, with investments in foreign countries, one general corporate headquarter, and several operation and R&D facilities that have their own decision power to a certain extent and on their respective regions. All these units are integrated in a network through which they communicate and share information. Transnational corporations are usually the result of strategies aiming at both becoming more responsive to local markets, developing globalscale competitive efficiency and benefiting from worldwide sharing of innovation and learning. Considering the above definitions and information, we can reasonably assess that Siemens fits to the model of transnational company more than to any other type of model. Indeed, the company developed a worldwide network with regional headquarters (at a continental level) as well as regional production facilities and R&D centers in order to be more adapted and responsive to local market demands. Each regional unit works independently to a certain extent and does not have to refer to the global HQ in Germany. The same process applies whenever different regional units need to work together hand in hand; that is, there is no need to refer to the German HQ. Though while implementing new major business plans or changing the business structure at a big scale, the regional unit must refer to the global HQ (e.g.: when the Belgian HQ was willing to take over the cement market in all French speaking African countries because they considered that thanks to the French language they would have stronger ties with local responsible business; Siemens Belgium had to refer and present a consistent business plan and strategic outlook to the German corporate HQ in order to get the approval).

4) Siemens’ Current Global Strategy, Values and Image Branding

Siemens’ recent strategy has been oriented towards the environment and sustainable development. The company has been actively promoting this aspect of the business and this can be seen in the general CEO’s speeches as well as on the website or in any advertising. This new corporate-level program aims at catching the wind of the rapidly growing eco-

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Siemens’ Strategic Development within the Wind Turbine Industry as a major driver for the development of the firm.

SIEMENS
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friendly trend. It is now one of the buzz word among the company itself and this trend is used

The company has then developed a whole brand new environmental portfolio which contains various products and solutions such as wind turbines, photovoltaic inverters or even steam turbines. The company even created a unique Renewable Energy Division to strengthen its position in this sphere. Nowadays, Siemens’ environmental portfolio contributes to roughly 30 percent of the total annual revenues of the company and represents a major drive for further growth. In this context Siemens has worked even harder on promising products such as wind turbines. In early 2010, Siemens was said to be number one in the market for offshore wind turbines and number five in the wind turbine market (onshore included). According to Andreas Nauen, CEO of Siemens Wind Power, the company aims to be in the top three wind turbine supplier in a 3 years’ time. In order to achieve this goal, Nauen acknowledged the necessity to be present in the three main markets which are Europe, the US and Asia.

In a more theoretical approach, Siemens’ strategy for the wind turbine sector can be viewed as a transnational strategy in the sense that even though they have worldwide production facilities, they have centralized their core competencies in one location. Indeed, the company decided to settle their Wind Division HQ in Denmark, this allows them to achieve some economies of scales on the “administrative” side of the operations as well as in the R&D sector; and moreover it allows the company to protect some of the most sensitive information.

5) Siemens in China

Siemens first came to China in 1872, that is, more than a century ago. Since then, they have massively developed their activities, not only by building production facilities but also by implementing corporate headquarters in Beijing as well as regional offices in some other 60 locations, affirming Siemens’ strong commitment to long-term development in this country. The company employs more than 43,000 people and had 2009 annual revenues of more than €5.2 billion.

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Siemens’ Strategic Development within the Wind Turbine Industry

SIEMENS
By M. Alihodzic & T. Dewilde

Siemens has been active in almost all their fields of activities in China; from high speed railways to medical healthcare solutions and wind turbine technology. Being one of the top foreign employers in mainland China and considering the seniority of the company in the country, Siemens has developed strong links with China. In fact, the interactions between companies and host governments are usually characterized by lovehate relationships. On the love-side stand the benefits of such a deal; on the one hand the company can access the local market and resources which represent a source of growth and further profits whereas on the other hand such a big company represents a source of employment, funds, economic development, imports substitute and exports promoter for the host country. On the hate-side, the two parties will seek divergent objectives. While the firm will seek an unrestricted access to resources and markets throughout the world and to have the opportunity to coordinate and control all aspects of the company on a worldwide basis, the host government will rather seek a company that is able to develop the local economy on a sustainable basis and hence it could be willing to act in favor of national companies (very common in the airline industry). The host government may also be reluctant to have an economy that relies too much on a specific company.

6) Siemens in the US

Siemens has been present in all fifty states of the US as well as in Puerto Rico for over 100 years. Headquartered in NYC and with more than 64,000 employees and annual revenues of more than USD 21 billion; it is one of the major foreign employers in the United States. Just like in China or Europe, Siemens is offering solutions from its 3 sectors: industry, energy and healthcare. The company has invested more than € 20 billion over the last ten years alone which indicates Siemens’ strong intentions to firmly settle on the US soil. Up today Siemens has already achieved major steps in the American windmill market; with wind farms in Texas and plants in Iowa and Kansas among others, they are currently the 3rd largest wind turbine manufacturer in the US. Siemens is a highly respected firm in the whole American continent and has proven its expertise in several areas. They are the n° light- rail manufacturer in North America, they 1 produce automation system that helps the US Postal Services to process up to 90% of the nation’s mail and among other things they are in charge of traffic lightning systems in major

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cities of the US. Hence, over time, the German company has won several contracts and has had to deal with public US administration which proves the close relationships that exist between these two entities.

III.

The Wind Turbine Industry

1) General Facts and Development

The global tendency on focusing to reduce CO2 and the search for more sustainable energy is in huge favor of the wind turbine industry. Even though the Cop15 (United Nations climate change conference 2009) ended up with no binding results for the participants, there is no doubt that the climate issue is something highly ranked in the political arena around the world. In addition, in these times of high and volatile fossil fuel prices, of uncertainty linked to gas supply in certain countries of the world, of difficulties financing new coal-fired power plants given expectation of a carbon emission constraint and finally of the growing consumer preferences for renewable energies, these sources of energy are more and more prompted to grow and so is the windmill industry. The Global Wind Energy Council (GWEC) is predicting a significant growth of about 155 per cent from 2007 to 2012 worldwide, representing a global estimated investment of more than €180 billion. The United States and China will be the main markets, driving up the industry with an annual estimated double digit growth of 20.7%. This was predicted before the financial crisis hit but is nevertheless still holding. As a matter of fact, even though the wind turbine industry has been affected by the crisis, it has not been hit as hard as some other industries. Indeed, lots of projects were abandonned or delayed due to an evident lack of credit. However, the stimulous packages launched by the different governments around the world have boosted the activity in that sector which has implied a quicker recovery. For instance, right after taking office, President Obama set a goal of doubling the wind energy production within the three first years of his mandate. Much of the financing needed to achieve this goal will come from stimulous packages.

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According to the International Energy Agency’s (IEA) World Energy Outlook 2010, though renewables sources are and will be growing fast for the next decades, the shift from fossil fuels to renewable energies will be part of a slow and progressive process and fossil fuels will still provide 78% of the total energy needs in 2035. The following graph provided in the IEA’s report shows a steady absolute growth for all sources of energy, however, renewables will grow at a relatively faster pace than fossil energy sources.
Non-fossil energy use grows rapidly, but fossil fuels will still provide 78 percent of total energy use in 2035 quadrillion Btu

120 100 80 60 40 20

History

Projections Renewables (excluding liquid biofuels)

Liquid biofuels Liquid fuels

Coal

Natural gas Nuclear

0 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035
Richard Newell, SAIS, December 14, 2009
Source: Annual Energy Outlook 2010

6

In the following graph, we can see that the GWEC is forecasting that the global wind capacity will witness a twofold increase in a five year time, and most of these new installations are to be placed in China and US, China taking the lead.

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Source: GWEC Global Wind 2009 Report

An additional aspect that needs to be treated is the particularity of the wind turbine market that makes it impossible for a company to really benefit from global-competitive efficiency. The costs of transportation are so high in that industry that it does not make sense to outsource operations in overseas market to benefit from low labor costs. While looking at the breakdown of the overall cost of a wind plant production, one can assume that only a bit more than a third of the overall cost can be subject to reduction due to lower local prices (wages, fees, etc.).

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Hence, each regional market (European, Chinese and US) are somehow exclusive markets that are “closed” in the sense that even though companies can share the knowledge from one division to another, one cannot fully benefit from the lower local production costs that another division encounters in its own region. This is a specific characteristic of this industry, for instance, the IT industry would not be subject to these limitations to exploiting global efficiency since transportation costs are dramatically lower in this sector.

2) The State of Competition

a) Competition with Other Renewable Energies

Renewable energies are the ones which release the lowest amount of carbon dioxide in the atmosphere. Wind turbines are showing off very good results in terms of environmental success, yet they are not the only source of sustainable energy production and other types of renewable energies can be considered as serious competitors, for instance: solar, hydro, geothermal, bio-fuels and biomass. Up until now, wind has been the preferred source of renewable energy but as the following graph suggests it, other alternative sources of energy are to develop in the future. The biomass activities are particularly expected to witness an outstanding growth whereas the other types of energies are expected to grow as well, nevertheless at a much lower pace. Hence we can deduct that the wind turbine industry will not only be subject to clashes between competitors inside the industry itself but it will also face the competition of other industries. In order to give a more concrete idea of the current situation, the new green power capacity installed in 2009 was distributed as follow: Wind: 39% Geothermal: 39% Other Renewables: 22%

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Nonhydropower renewable sources meet 41% of total electricity generation growth from 2008 to 2035 billion kilowatthours

600 500 400 300 200 100 0 1990

History

Projections

Biomass

Wind Solar Waste Geothermal

1995

2000

2005

2010

2015

2020

2025

2030

2035
21

Richard Newell, SAIS, December 14, 2009

Source: Annual Energy Outlook 2010

b) Competition within the Wind Turbine Industry

The wind turbine industry is characterized by a very high degree of competition. Yet, almost 70% of the market is shared between solely six worldwide players; the remaining 30% being spread across smaller companies. Nowadays, tens of different companies are manufacturing windmills or at least parts of them. These companies are offering solutions for the smallest size and simple projects to the largest size and most advanced projects. Among all those companies, we are to remember the top 10 of them and some other major players that are to show up in the very near future. The latest top 10 ranking based upon the installed capacity in 2009 gives the following results: 1. Vestas (Denmark) 35,000 MW 2. Enercon (Germany) 19,000 MW 3. Gamesa (Spain) 16,000 MW 4. GE Energy ( United States) 15,000 MW 5. Siemens (Denmark / Germany) 8,800 MW 6. Suzlon (India) 6,000MW 7. Nordex (Germany) 5,400 MW 8. Acciona (Spain) 4,300 MW 9. REpower (Germany) 3,000 MW 10. Goldwind (China) 2,889 MW
Source : Renewable-energy-sources.com

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In addition to this top 10, we need to add two major players to come, that is, Sinovel (China) and Dongfang Energy Corp. (China). The reason to consider these two last competitors is the crucial role they will play in the next decade. Their influence in the industry will be considerable; we will develop this issue further down in the paper. Yet, this top 10 ranking is varying according to the source and the data’s used for the research, thus, if we consider the recent 2009 report of BTM Consult Aps using global market percentage, the following ranking is obtained: 1. Vestas (Denmark) – 12.5% 2. GE Energy (US) – 12.4% 3. Sinovel (China) – 9.2% 4. Enercon (Germany) – 8.5% 5. Goldwind (China) – 7.2% 6. Gamesa (Spain) – 6.7% 7. Dongfang Corp. (China) – 6.5% 8. Suzlon India – 6.4% 9. Siemens Wind Power (Germany) – 5.9% 10. RePower (Germany) – 3.4%
Source: BTM Consult Aps

Hence, we can see that Siemens is not ranked 5th anymore but way farther at the 9th position. In the meantime, one would notice the presence of three Chinese manufacturers in the top 10 and two of them belong to the top 5, highlighting the tremendously increasing presence of Chinese companies in this business. Whether we use one or another ranking system, Vestas is the uncontested leader of the market. GE Energy is also present in the top 5 which indicates the strong presence of the American company which is the closest competitor to Siemens in terms of company structure and global product portfolio. Hence, as one may point it out, Siemens is far from being the leader on the general wind turbine industry. In fact, according to the BTM Consult Aps’s report, Siemens would be in a pretty bad position with a relatively low market share.

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3) The Offshore Sector

While studying the wind industry market, it is essential to distinguish the onshore market from the offshore market. As a matter of fact, the difference in turbine sizes, the harsh weather and the limited access for service and maintenance lead to a very different approach in terms of design and manufacture of wind turbines. Hence, the market is quite different than that of the onshore sector and for the above reasons, offshore installations remain more expensive than onshore ones and thus it keeps some companies out of the market. In terms of exploitation, offshore wind speeds are higher and more stable than onshore winds, both charateristics which lead to a greater marginal profitability. In addition, for a great part of the U.S. and China, offshore sites are closers to major electricity load centers and this proximity, in turn, reduces the costs of accessing the large consumption centers. Though the offshore market is quite different, it nevertheless represents a huge potential. The U.S. Department of Interior has estimated that, only on the coast of New England, are located more than 90 GW of wind potential resources. Moreover, it has been estimated that the region of the Great Lakes could offer a wind potential even bigger than the one that all US coastal areas reunited could offer. China, just as much as the U.S. and Europe, offers heaps of great locations for offshore installations (Southern China sea being one of the best). Hence, the potential market for offshore installations appears to be considerable if not “unlimited”. Finally, considering all the factors reunited, only few companies are actually operating in the offshore market, resulting in a weaker competition.

4) The Chinese Market

a) Growth and Market Drivers

As always, while talking about China, the figures are outstanding. The energy industry makes no exception to this rule. China consumes now more than 10% of the world’s energy, and this is, considering the fact that the average Chinese consumes 12 times less energy than the average American; otherwise, China would have to multiply its energy production

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capacity by up to eightfold. As the population is getting richer, this process of increasing energy consumption per capita is likely to go on and this, in turn, reveals the huge potential market that China offers for the decades to come. The rapidly developing wind power in China can partially be explained by the strong government support that the industry gets through the Renewable Energy Law. Through this law the Chinese government has the intention to build up the industry in a short period of time. The unofficial target was to reach 150 GW of capacity by 2020 but it appears that this figure will be reached way before the projected deadline. As part of their plan to increase the use of renewable energies, the Wind Power Concession Project has also encouraged the development of the wind turbine industry. The main purpose of this project is to reduce the in-grid power tariff by building large capacity wind farms and thus to benefit from economies of scale. According to this program, wind farms must reach a 100 MW capacity to be eligible. This project also aimed at attracting large companies and especially foreign ones to invest in the Chinese wind power sector. And this has been done through several policies that reduced the market risks significantly. Another aspect of the governmental support has been the strong VAT cut on wind power. As a matter of fact, it was reduced from 17% to 8.5% in the early 00’s. Finally, with regard to the crisis, the Chinese governmental stimulus package has been credited for playing an important role in the dynamics of this sector in this context of recovery from the financial crisis.

Regarding the actual capacity, the Chinese market offers a huge potential. It has been estimated that the onshore producing capacity could reach 235 GW whereas the offshore producing capacity could reach 750 GW. Considering that the unofficial 2020 target of 150 GW has not been achieved yet, one can imagine the remaining potential market.

b) Competition

In terms of competition, the Chinese market is characterized by a rapidly growing number of wind turbine related products manufacturing companies. As a matter of fact, in 2004, only six producers of wind turbines were present on the Chinese territory whereas nowadays more than 70 producers have been accounted. The same year, yet 75% of the Chinese windmill

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equipment was foreign-made whereas in 2008, Sino-foreign joint-ventures accounted for almost 62% of China’s market share. Hence, one can quickly understand that the state of the competition is rather fierce in this huge market. Nevertheless, not all of these producers are focused in the exact same market; indeed, some are more focused on the large capacity windmills whereas some others are more oriented towards small capacity windmills. In addition, some of them only produce some of the components which are required for a windmill to be run, however, for companies such as Siemens or GE Energy which provide solutions for the entire energy value chain, all of them are to some extent direct competitors. In fact, we need to pay attention to three major companies: Sinovel Wind Group Co., Ltd. Goldwind Science and Technology Co., Ltd. and Dongfang Electric Corporation. Indeed, these three companies are the major Chinese players and have been ranked in the top ten of the wind industry sector in China. They represent a very serious competition in mainland China but not only; they put up ambitious goals for the next decade to come in the worldwide market.

c) A Specificity of the Wind Turbine Industry that Changes the Usual Expectations

We need to add a crucial aspect concerning the Chinese market and the usual expectations of such a market. Every single company is always looking for global efficiency and to benefit from lower operational costs. Nonetheless, in this particular case, while talking about global competitive efficiency we need to keep in mind that windmill manufacturers do not enter the Chinese wind energy market to benefit from low labor costs as one would have expected and as it occurs in other industries. As mentioned previously, the costs of transportation are so high in the windmill business that it is essential to have local production centers in order to remain competitive. Thus, in this particular sector, the primary reason for any company to settle in a country is to limit transportation costs as much as possible and not to benefit from lower labor costs. Hence, it would not make any sense to outsource operations overseas if the main driver of this relocation was to pay lower wages.

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5) The American Market

The American market, just as much as the other markets, has suffered from the financial crisis. However, the recovery process has already begun and even though 2010 is expected to be rather calm, 2011 should mark the return to tremendous growth in the wind power industry. As a matter of fact, even though 2009 was a record year in terms of installations (more than 10 GW). Yet, various manufacturers have encountered serious employee cutoffs. Nonetheless, they are now hiring and building up considerably in order to face the rapidly expanding and recovered market. In terms of figures, more than 40,000 windmills are expected to be built within the next 5 years and it has been estimated by the U.S. Department of Energy that the total U.S. wind energy potential is over 10,000 GW. Nowadays, that figure is twice the electricity generated by all sources of energies in America. According to a report of BCC Research released in late 2008, the US market should be worth USD 61 billion, up from a bit more than USD 11 million in 2008. In the same report, the compound annual growth rate (CGAR) between 2008 and 2014 was expected to be over 40%. These extremely outstanding figures are among others due to the strong US government support. The US government has been an active participant to the strong growth the wind industry has known so far. First of all, it has helped the sector through different tools such as the PTC program. Indeed, the PTC program (Production Tax Credit) which was run at a federal level has offered significant incentives for electricity generated from renewable sources in the first 10 years of operation of the energy generating facilities. Initially, it was supposed to end in the early 00’s but was extended several times; as for now this program is supposed to end in 2012 but it is likely to be extended once again. Secondly, the US government, under the Obama administration has unveiled an ambitious environmental plan which aims at raising the wind energy to 20% by 2030. Finally, the Recovery Act has also helped to counterbalance and weaken the negative effect of the crisis on the windmill business.

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6) The European Market

Europe, and more particularly Denmark, are actually the birthplace of the windturbine industry. This can be seen through the market itself. Indeed, the competition is very high and several major manufacturers are settled in the EU; among others Vestas, Siemens, Enercon and Gamesa. The very high concentration of manufacturers is also the result of an constantly growing European interest for renewables and sustainable power. While observing the cumulative global installed capacity, we can see that the European market accounts for almost 48% of the total. However, while looking at the forecasted cumultive capacity in the end of 2012, one can observe a strong reduction of the European share to only 33% of the global market whereas Asia and the US will see their shares growing. (appendix A5) . In other words, without saying that the European market is mature, it nevertherless offers smaller interest than the US and Asian markets. If we take a look at the annual installed capacity by region from 2003 to 2009 (cfr below diagram), we can clearly see that the growth curve in Europe is not as outstanding as the one in the U.S. and Asia. The same graph shows exceptionnal results for 2008 and 2009, though it did not take into account the financial crisis and thus has somewhat overestimated the real figures.

Source: GWEC

Climate challenges and the huge dependency on gas and oil have made the European Commission very oriented towards sustainable energy sources. Europe has been the global

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leader in terms of green energy investments and targets for the future decade. This can be seen through the ambitious goals that were implemented lastly. Indeed, the European Commission has instaured a binding target for 2020. As a matter of fact, renewable energies should source 20% of the total needs by that year. Furthermore, 35 % of the electricity consumption has to come from renewable sources. In comparison to the 2005 level of 15%, this represents a tremendous increase. The European Commision also estimated that out of these 35%, 12% could be generated from wind resources and that one third would come from offshore installations. Though all these objectives are ambitious, the EWEA is arguing that without a rapid implementation of stronger policy measures, this target cannot be met and thus the actual market forecasts could be somewhat biased. In conclusion, the European market, way ahead to the U.S. and Asia, does not show a future as attractive as the two others and the overall potential that will be developed in the near future will also depend on the way EU regulations are implemented and enforced.

IV.

Siemens in the Wind Turbine Industry

1) Achievements, Experience and Outcomes

Siemens settled its Wind Power Division in Denmark. Denmark being the all time world leader in terms of renewable energies, this move showed their strong commitment to sustainable development and their willingness to be at the heart of the renewable energy business. Furthermore, Siemens has acquired the Danish company Bonus Energy A/S in 2004. This acquisition has given Siemens even more knowledge, experience and credibility in the wind turbine industry. Nowadays, more than 5,500 people are working in the Wind Division which represents a tremendous 650% increase in comparison to the 2004 level. In terms of expertise, Siemens has developed wind turbines for more than 30 years. It has achieved various projects around the world and has so far installed more than 8735 wind turbines. Among other projects, Siemens built the first ever wind farm in China and Asia at

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the same time and they also built the first offshore wind farm in the U.S., marking a major step on the US soil. Hence, it has acquired a strong knowledge in this field of activity. Nowadays and as previously mentioned, Siemens aims at becoming the world third largest windmill producer within 3 years. Another aspect which Siemens can rely on is their proficiency that can be seen as a major asset in China and elsewhere but especially in China considering the outstandingly growing number of wind turbine manufacturing companies (from 6 in 2004 to 70 in 2010). This rush into the wind turbine industry was characterized by inadequate research and an obvious lack of planning from a lot of Chinese companies; this has eventually led to non-adapted products and to a decrease in terms of quality. In turn, this implies that Siemens, through its expertise, has got a strong competitive advantage on many of its newcomer Chinese rivals. In order to analyze Siemens’ situation in this sector it is convenient to separate its activities in two: the offshore sector and the onshore sector. Siemens has developed both sides of the market; however it has developed a strong competitive advantage in the offshore area. Siemens has had a longtime presence in the wind industry. Though it is not the number one company in the onshore sector, it is the uncontested leader in the offshore market. The company, through its experience, its size and its wide portfolio has various advantages over the competitors. These are more apparent in the offshore market but it remains useful to list them both in the offshore and onshore field.

a) On the offshore market

Siemens was historically the first company to enter this business by installing the first offshore wind farm in 1991 in Vindeby (Denmark). Since that date they have remained number one in the sector with an overall installed capacity of more than 600 MW and this, despite a growing competition. Up until now, the company has acquired more experience than any competitors, it has supplied the world’s largest offshore projects and it presents references that no other firm could equate. Since they were the first company to design and manufacture offshore wind turbines, this segment represented some kind of niche at least in the early 90’s.

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A niche can be defined as a market segment for which wants are not being addressed by competitors and for which one ground-breaking firm offers the solution and find itself alone to do so. Hence, Siemens inherited of this strong and so particular know-how and in the same time of a dominant position on the market. Nowadays and as the following diagram shows it, they remain the number one company worldwide (and in Europe) in terms of offshore installations and the company still has an evident competitive edge over several competitors.

This competitive advantage can be understood through different aspects and factors. First of all, for the reasons pre-cited in the above part dedicated to the description of the offshore wind industry, only half of the top 12 wind turbine manufacturers have the capabilities to offer offshore solutions. Indeed, the offshore windmill industry is somewhat different from the onshore. As a result, several companies deny the offshore market because they see it as too demanding in terms of R&D investments. Furthermore, the onshore sector is doing well and lots of these companies (e.g.: Enercon, Nordex) have their order book full for the next years to come. In this regard, they do not see the necessity to enter the offshore market. In addition to the R&D issue, they would not have sufficient resources on the short run to enter the offshore subset. Hence, natural barriers to entry limit the competition on this segment of the market.

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b) In a more general way

Siemens has had more experience than any other competitor in this particular field, and, unlike most of the wind turbine suppliers; it offers equipment for the entire energy value chain, from wind turbine to net conversion and to power distribution. This confers Siemens several advantages:

-

The opportunity to provide turnkey solutions:

While other companies would require the support of subcontractors for some parts of the projects, Siemens can undertake every single part itself and as a result is able to have a greater degree of coordination which in turn leads to fewer potential problems in terms of delays, budget overrun or supply chain.

-

The opportunity to offer packages By having the capability to provide customers with equipment for the entire energy value chain, Siemens may create packages which offer the German company the opportunity to work on discounts on one side or the other of this energy chain. Thus Siemens has got the capability to keep competitors away by offering lower prices on some components of the wind turbine electricity process.

In addition, the fact that Siemens produces a wide range of industrial products allows them to benefit from economies of scale and economies of scope. We talk about economies of scale when the average cost of producing a good decrease when the production of this good increases. We talk about economies of scope when the combined production of two goods is more efficient than the production of these two goods separately. In this particular case, different electrical components that would be expected to be sold as final products could turn out to be intermediate goods for the production of wind turbines (or associated required products) and thus could lead to both economies of scale and

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economies of scope. On the contrary, competitors like Vestas, Sinovel or RePower cannot use such economies since they only produce wind turbine directly related products.

Another major advantage which Siemens can rely on is the reputation that they have built over the years and all over the globe; and this is true not only in the wind energy business. In fact, their references in the wind energy sector talk for themselves: since the offshore industry was established in 1991 (by Siemens), every single project was delivered on time and within the projected budget. Therefore, as for the other businesses, Siemens must work and use these factors to convince customers that the higher prices are justified by an incomparable quality and by a unique service. Furthermore, their longtime presence in China and in the U.S. also allowed them to get to know foreign cultures and local environments. This is true at two different levels: on the one hand at the technical level and on the other hand at the political/commercial level. On the technical point of view, even though this kind of business does not need to be close to the end-customer (as a cosmetic company would need it for instance), it is necessary to acquire an accurate knowledge of the land in order to be able to assess where each product fits the best and in order to ensure the highest exploitation rate. In fact many companies suffered from great losses because of a lack of adaptation. For instance, Tianjin Dongqi Wind Turbine Blade Engineering CO, which is a unit under the Chinese giant Dongfang Electric Corp was caught unprepared and non-adapted and offered blades which were too short to comply with the market’s expectations. On the contrary, Vestas has designed a tailor-made wind turbine adapted for low winds and to resist harsh winters of Mongolia. Another example is the latest trend for direct drive design turbine which accounted for more than 14% of the market in 2009. In conclusion, the adaptability and the tailorisation of the wind turbines to the local needs are crucial to succeed. On the commercial point of view, it is also a strong plus to have the know-how in terms of dealing with local partners and in aim to set up a strong long-term relationship with them. As a result of their longtime presence on the American and Chinese soil, they have strengthened their position and for instance, the fact that the company employs more than 43,000 people across China may have an influence in negotiations for public contracts, and especially against foreign competitors such as Vestas that do not have any other activities overseas. By building a new plant in Shanghai’s Lingang New City and in Iowa (U.S.), Siemens showed its strong commitment to long term and sustainable development in these countries.

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Finally, unlike most of the competitors, Siemens offers business-to-business financial services. These services provide the customers with more possibilities for funding their projects. This has provided Siemens with a considerable competitive advantage in case of financial turmoil and especially considering the recent credit crunch that the global economy has faced. While customers have difficulties to fund new large projects, Siemens eases the process and somewhat act as a substitute to banks. Out of the top 10 companies operating in the wind turbine industry; only one (General Electric Energy) offers financial services comparable to those offered by Siemens. Though Andreas Nauen (CEO Siemens Wind Power Division) recognizes that those services help Siemens to seal deals with customers, he strongly supports the facts that Siemens is not chosen only because of the financing.

V.

Entering Foreign Markets

We have seen on the above that the wind turbine industry is represented by three major markets: Europe, the U.S. and China. Each of them offers a potential market which is considerable at the very least. Considering their size and the high degree of competition in the wind turbine industry in general, it may not be easy to enter, survive or strengthen its position in such markets. Hence, companies may have to sacrifice parts of the overall market to focus only on some restricted areas in order to remain competitive and to have enough resources to supply the markets they are in; in addition, companies may have to remain specialized in a particular sector to keep their competitive edge. This section will treat about the reasons for internationalization and the different ways to enter a foreign market or country. Afterwards we will try to describe the different strategies a company should follow according to the market specifications.

1) Strategic Alliances

While going international there are several ways for a company to do it. A company may either enter a market on its own (as long as the local regulation allows it) or get into it via the

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use of strategic alliances. The intensity of the strategic alliance will depend on various factors such the level of risks and investments that the company wants to take, the type of product the company is producing, the operational cost that the company is facing. Strategic alliances are relationships between companies that operate internationally. These relationships may be based upon different reasons: R&D arrangements (R&D arrangement between EADS and Northrop Grumman for the development of a new tanker aircraft) Distribution alliances (iPhone exclusive arrangements between network providers and Apple) Marketing arrangements

Strategic alliances are a key aspect in terms of global competition. They are sometimes the only way to develop the capabilities and the needed resources in a limited timeframe. Hence, strategic alliances have a huge impact on the competitive positioning of companies. Strategic alliances also shape the competition since they can reduce the intensity of competition and even raise barriers for potential entrants by building up complex value chains. Strategic alliances will vary according to the level of interaction and the level of competition between the allied companies as shown on the following graph.

Source: Transnational Management, Fifth Edition – McGraw-Hill Companies, Inc

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The first level of alliance is the simple cooperation agreement and it goes on to the last and most complex level of alliance which is the joint-venture. The progression from cooperation agreement to joint-venture will depend on how much the company wants to invest and how much risk it wants to take by doing so, how much information is the company ready to share and what type of information it shares. a) Joint-Ventures

On the most extreme level of alliance stand the joint-ventures. Joint-ventures are equitybased which means that a new company will be set up with the participation of different companies which will each own a certain stake in the new business. Joint-ventures can bring about several advantages; among others the access to technologies, core competencies and local management skills. They can also grant the access to countries where sourcing a local firm is required (e.g.: People’s Republic of China) and last but not least JV’s can open access to distribution channels. Usually, R&D and manufacturing are the most common forms of joint-ventures. Joint-ventures as well as acquisitions have the great advantage to reduce the transaction costs. They can also bring about the possibility to keep the local management in order to benefit from its expertise in terms of local workforce. Joint-ventures may also be a step for a further acquisition. Indeed, there may be very high information costs while a company tries to acquire an asset, that is, another firm, and when it has little knowledge over the desired firm. Hence, the joint-venture reduces the information costs as well as the uncertainty of the asset that is to be acquired.

2) Risks of collaborating

The main risk of any collaboration is that one party or another of a strategic alliance, say, a joint-venture, would end up having a competitive advantage on the other. For instance, if two competitors in some market collaborate together in some other market to develop a common product; one could end up using the knowledge of the joint-venture for the market in which they are direct competitors. Hence, it may sometimes be the case that the benefits of the strategic alliance are asymmetrically distributed between the parties.

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In any case, the process of learning by doing and the benefits that both companies will get from the alliance will always lead the two competitors to be strengthened. On the one hand, a company will thus improve its performance but on the other hand it will reinforce the competitor. Finally, collaborating always exposes companies to the risk of being taken over by the other collaborator, which obviously is not desirable from the workers and managers’ point of view since it often implies restructuring among the workforce.

3) Foreign Direct Investments and Acquisitions
For a company to enter a market, if not using strategic alliances, two other options remain: entering through foreign direct investments (FDI) or acquiring a local producer. By building a new plant or acquiring a current business which has got suitable installations the company will benefit from market knowledge and should be able to adapt its product better to the local needs. Yet, for the wind turbine industry, it remains useful to keep in mind that the need to tailor the products to the local demand is not as important as it is for other industries (e.g.: cosmetic industry, food industry, etc…).

The acquisition presents several advantages. First of all, it allows the acquiring company to shape the competition by getting rid of a competitor. Second of all, in comparison to the jointventure or any other type of strategic alliance, the acquiring firm is not giving away any knowledge and thus does not take the risk to give a competitor the chance to benefit from that knowledge, then to split and to take over in the end. An acquisition will also give the acquiring company a greater span of control on local operations and a greater knowledge of the local market. Of course an acquisition will also present different bad points. Among others the high integration costs of the labor force, the higher commitment that is required and the difficulties to implement a new management team. Hence, a joint-venture could be favored when the cultural distance between the two merging companies is large. It will be harder to proceed to an acquisition of a company if this company is part of a larger parent firm and if in the meantime the parent company is not structured as a network of

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independent divisions. Furthermore, the more the sub-companies are forming a whole, the harder it will be to acquire a specific division and to get it separated from the whole. In that case, a joint-venture will be favored.

FDI and acquisitions are certainly more risky modes of entry since the invested sums of money are much more important than those implicated in strategic alliances and are to some extent sunk costs that cannot be recovered or at least not easily. Foreign direct investments require more resources, which in turns, implies that the company must be able to provide all necessary funds and equipment. Either way, the core competencies are kept inside the firm In addition, the foreign company could be considered as an insider since it invests in the country.

VI.

Strategic Planning

This section will be used to describe how a company should behave on the market according to its position and to the stage of the industry. As a matter of fact, a company that wants to define a good strategy needs to know in what stage the industry is and where does the organization fit. The Arthur D. Little matrix is of a very big use to assess these points although it is a bit outdated. It helps formulating the right strategy depending on the industry maturity and the competitive position. The competitive position will be determined by the segment, in which the company operates, the range of products it markets as well as the products themselves and finally the geographical scope of the company. The industry maturity can be compared to the lifecycle of a product, with an experimental phase followed by a rapid expansion phase, a maturity phase and eventually followed by a decline. This matrix is represented as follows:
Stage of Industry Growth Maturity

Company 's competitive profile Embryonic Dominant Strong Favourable Tenable Weak

Ageing

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One could describe the wind turbine industry in the growth stage considering that it is strengthening and expanding fast and that sales are increasing dramatically. Besides, in terms of competition it could be situated in between the stage of growth and maturity if one considers the high number of companies operating in that industry.

As a result of the matrix, 20 different combinations of recommended strategies are possible depending on every stage of the industry and on the competitive position. We could position Siemens on the wind industry market as being at the crossing of Growth and Favourable. Indeed, according to the definition of the ADL matrix, the state of favourable can be defined as the situation where a business has got a competitive advantage in some part of the market but rivals are proactive and from equal strength and thus the company needs to work in order to remain strong and competitive. Knowing that, we can determine the type of strategy one would expect Siemens to follow according to the ADL matrix. Siemens should keep working on improving its competitive advantage and try to increase its market share. In the meantime, Siemens should invest on a selective basis in order to improve its position.

VII.

Siemens’s Strategic Decision

This last section aims at wrapping up all the information previously mentioned in the paper and at using it in order to formulate a precise strategic decision making that Siemens should follow to best develop their activities in the near future.

We have studied three different markets in this paper. All three of them have a very high potential. Though Europe will witness a significantly lower growth rate than China and the U.S., this market stays nonetheless very attractive. The Chinese and U.S. markets are by their sizes both goldmine and considering the early stage of development of the industry in these two countries, Siemens may not abandon either one of them in order to focus on the other. Siemens is a global player and it needs to be present on all three markets; it needs to reinforce its position on the European market and to grow fast in the Chinese and American markets in order to face growing competitors. Being one of the world’s largest

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conglomerates, it has the human and financial resources to grow and to further develop its

If we come back to the presentation of the company, one would recall the reform that occurred in the mid-90’s. Siemens shifted from the strategy of being a good number two in many fields to being the best in fewer fields of activities. According to this doctrine, the company has to focus on what it is the best at; that is, the offshore sector. As a matter of fact, Siemens has more than 70% of market share in Europe, it has got the first offshore wind farm contract in the U.S. in 2009 and so far only one offshore wind farm has been built in China. It has been shown that the offshore segment is big enough to operate solely on that side and this sector presents a bright outlook. Moreover, several companies do not see the interest of entering such a market since the onshore is doing pretty well and considering that wind turbines are very different in the two different subsets and thus the competition is already reduced as previously mentioned. As the most experienced company in the sector, Siemens must take advantage of that position. The company must expand rapidly and aggressively by developing manufacturing centers in order to defend that segment and to assure a large market share since Siemens would rely only on this field. The demand will keep growing fast and that for a long period which ensures Siemens’s future in that business. The onshore market, even though not saturated, is much more competitive. Siemens’s market share is currently rather small in this segment and the growing number of competitors is likely to force each company’s market share to decrease. In the Chinese market, three major Chinese companies altogether with Vestas and GE Wind oppose a very strong competition. Hence, it would be a good opportunity for Siemens to focus on one single segment in order to battle effectively on this field rather than using the resources in different areas.

Concerning the way Siemens should develop its operations, Europe being its home base; there is no question that the company should operate on its own. The U.S. market does not offer many good opportunities of alliance or acquisitions and in addition Siemens already has manufacturing plants in various states. Hence, the company should keep developing new plants to increase the offshore production capacity. The company should localize its production center near large harbors. Indeed, the previous manufacturing plants it has built are located in Iowa and Kansas which does not give any access to sea. We could imagine the Kansas plant to be shut down; however the Iowan plant should remain operating since it provides Siemens with an access to the great lake

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region where the potential is high. As we have seen it previously, transportations costs are very high and thus, to serve the offshore market, it does not make sense to build far inland. Cities hosting large harbors, close to the great lakes and with easy access to the sea should be targeted.

Regarding the Chinese market, three options are to be considered: a joint-venture, an acquisition or FDI. We would strongly oppose to the option of the joint-venture. As mentioned above, a joint-venture represents several risks of knowledge spillovers. Considering that Siemens would only be targeting the offshore market and considering the very high transaction costs that make it impossible to totally insure the company against knowledgestealing, if a company would happen to leave the joint-venture after having gained the knowledge, that would put Siemens’s future in the wind turbine industry at risks. In addition, it would be difficult to implement a management team between the two entities. Hence, Siemens should not operate on a joint-venture partnership. The acquisition of a local company offering offshore solutions seems to be a good solution in the sense that it could allow Siemens to get rid of a serious competitor (e.g.: Dongfang, Sinovel, Goldwind…). Indeed, reducing the degree of competition in the offshore sector would be one of the few valid reasons to proceed to an acquisition. As a matter of fact, the company would not get any advantage in terms of portfolio diversification since the products commercialized on the offshore market are very similar from one company to another in opposite to the onshore market in which wind turbine sizes can vary a lot. In addition, considering the fact that most of the competitors are nowadays mainly developed on the onshore industry; Siemens, by acquiring a competitor would have to acquire a lot of undesirable assets. For instance, by buying Sinovel and by keeping this strategy of focusing only on the offshore, Siemens would have to buy useless assets such as inland plants that would not be adapted for the production of offshore wind turbines and that would require significant and costly revamping or/and would be too far away from the shores. This shows the difficulty that Siemens would encounter while seeking to acquire another firm. An acquisition would also create a worldwide giant with extremely large capabilities. Siemens would gain the local knowledge of the market which they still need to some extent (not on a technical level though) and such an acquisition would reinforce the ties with the local authorities. It would give Siemens an immediate increase in terms of resources and capabilities which would help it getting commissioning more projects and secure the Chinese offshore market. Once again, acquiring a company that would only offer onshore solutions does not seem interesting since Siemens would have to invest massively in converting the
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production chain and they would not benefit from the existing knowledge since it would concern the onshore sector. Hence, in that case, investing in new greenfield self-owned plants would be a better option. Thie option of greenfield and FDI would be the most expensive along with the acquisition; however it presents the advantage that it does not induce any integration costs. Though it prevents integration costs, the greenfield option takes more time to be effective. Hence, for a company that would need to act rapidly in aim to securing its market, the acquisition of a competitor would appear to be the best solution. In the case of Siemens, the company is already building a plant that should be operational in the second half of 2010. It is expected to serve the Chinese market as well as export and the company sees it as an excellent starting base in this region since it is located next to the giant harbor of Yangshang (Shanghai). Taking this fact into account, it seems reasonable to believe that Siemens does not need to acquire a competitor for production grounds in the very near future. Hence, the strategy that we would recommend for Siemens would be to focus on the offshore market and to reallocate the resources (workforce and R&D centers) currently used on the onshore sector to the offshore segment in order to increase their capabilities, to secure their competitive advantage as well as their leader position.

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VIII. Conclusion
In conclusion, it appears clearly that the wind turbine industry presents a very high potential all over the world and especially in the three main markets that are Europe, the U.S. and China. The competition is fierce and forces the various companies to keep innovating and defending their market shares. Siemens ‘position in the onshore sector is rather weak whereas the company is by far the strongest and dominant player in the offshore segment. Considering the high degree of competition on the onshore subset and the relatively low level on the offshore, we suggested that Siemens should focus on the offshore activities and dedicate its resources to that segment. After having studied the markets, different modes of entry have been examined for each one of them. Series of consideration have been taken into account and we have arrived to the following recommendations. It seemed clear that on its home continent Siemens would develop and expand on its own as well as for the US market for which they already had consequent installations. The Chinese market was subject to more hesitations, however, considering the potential danger and difficulties that a joint-venture could represent, the costly disadvantages that an acquisition could bring about and the fact that no immediate production capacity expansion is required led us to conclude that Siemens should grow on its own via FDI and its own greenfield installations.

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IX.

Appendix

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X.
•

References
Breakbulk

- http://www.breakbulk.com/content/?p=671 • BusinessGreen

- http://www.businessgreen.com/business-green/news/2246411/chinese-wind-turbinemakers • CleanTech Group

- http://cleantech.com/news/5595/report-china-holds-world-largest - http://cleantech.com/news/4501/siemens-breaks-ground-chinas-wind - http://cleantech.com/news/5176/vestas-unveils-integrated-wind-power • Congressional Research Service Report for Congress

- Wind Power in the United States: Technology, Economic, and Policy Issues – June 20, 2008 - Jeffrey Logan and Stan Mark Kaplan • Enercon GmbH

- http://www.enercon.de/fr/_home.htm • Energy Farming International

- World Market Forecast: ep4 Offshore - World Market of the Offshore Wind Industry • European Wind Energy Association

- 2009 Annual Report (published in April 2010) - Report: Delivering Offshore Wind Power in Europe: Policy Recommendations for Large – Scale Deployment of Offshore Wind Power in Europe by 2020 - http://www.wind-energy-the-facts.org/en/part-i-technology/chapter-3-wind-turbinetechnology/evolution-of-commercial-wind-turbine-technology/large-commercial-windturbines.html - http://www.wind-energy-the-facts.org/en/scenarios-and-targets/chapter-5-globalscenarios/chapter-5-global-scenarios.html - http://www.wind-energy-the-facts.org/en/scenarios-and-targets/chapter-6-the-global-windenergy-outlook-scenarios/chapter-6-the-global-wind-energy-outlook-scenarios.html

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- http://www.wind-energy-the-facts.org/en/part-3-economics-of-wind-power/chapter-2offshore-developments/development-of-the-cost-of-offshore-wind-power-up-to-2015.html - http://www.wind-energy-the-facts.org/en/part-3-economics-of-wind-power/chapter-6-windpower-compared-to-conventional-power-generation/ - http://www.wind-energy-the-facts.org/en/part-3-economics-of-wind-power/chapter-1-cost-ofon-land-wind-power/future-evolution-of-the-costs-of-wind-generated-power.html • GE Energy Portal

- http://www.gepower.com/businesses/ge_wind_energy/en/index.htm • Goldwind Science and Technology Co., Ltd.

- http://en.goldwind.cn/ • Harvard Business School

- Rev: March 18, 2002 - Siemens Case Global Development Strategy (A) – Stefan Thomke •

People’s Daily Online

- http://english.people.com.cn/90001/90778/90860/6898839.html • Marketing Teacher Ltd

- http://www.marketingteacher.com/Lessons/lesson_a_d_little.htm • Mind Tools Ltd

- http://www.mindtools.com/pages/article/newSTR_88.htm • RenewableEnergyWorld.com

- http://www.renewableenergyworld.com/rea/news/article/2009/09/vestas-siemens-launchnew-offshore-wind-turbines • Reuters

- http://www.reuters.com/article/idUSTRE62S12620100329 - http://www.reuters.com/article/idUSTRE6174J020100208 • Siemens

- http://www.siemens.com/energy

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http://www.siemens.com/press/en/pressrelease/?press=/en/pressrelease/2009/renewable_e nergy/ere200905053.htm - http://cn.siemens.com/cms/cn/English/press/presscontent/Pages/20090522.aspx • Sinovel Wind Group

- http://www.sinovel.com/Companyoverview2.html • • • Strategic Management Journal, Vol. 18, 1–12 (1997) : Choice Between Mergers/Acquisitions and Joint-ventures Transnational Management : Text and Cases – 5th Edition - Christopher Bartlett, Sumantra Ghoshal and Paul Beamish US Department of Energy

- Energy Efficiency and Renewable Energy – December 2008 • Vestas

- http://www.vestas.com/ • WindMill Electricity

- http://www.windmillelectricityinfo.com/global-wind-power-denmark • WindPowerMonthly

- http://www.windpowermonthly.com/news/994416/Siemens-wins-460MW-Cape-Windproject-plans-US-offshore-facility/ - http://www.windpowermonthly.com/news/993269/China-dominates-installed-capacity-2009/ - http://www.windpowermonthly.com/News/MostRead/974452/Germany-Spain-leadEuropean-wind-power-capacity-says-EWEA/ - http://www.windpowermonthly.com/go/marketstatus10/ - http://www.windpowermonthly.com/news/indepth/961570/Market-status-global-wind-power2009/

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References: - Wind Power in the United States: Technology, Economic, and Policy Issues – June 20, 2008 - Jeffrey Logan and Stan Mark Kaplan • Enercon GmbH - http://www.enercon.de/fr/_home.htm • Energy Farming International - http://en.goldwind.cn/ • Harvard Business School - Rev: March 18, 2002 - Siemens Case Global Development Strategy (A) – Stefan Thomke •