Navigant Report Analyzes Global Wind Power Industry’s Supply Chain Trends

As a specialized, global expert services firm, Navigant focuses on assisting clients in creating and protecting value in the face of critical business risks and opportunities. Its services extend from expert and advisory work through implementation and outsourcing.

The Navigant team’s research methodology combines supply-side industry analysis, end-user primary research and demand assessment, and deep examination of technology trends to provide a comprehensive view of these industry sectors. The report examines the significant forces shaping the global wind power industry’s supply chain, including analyses of more than 500 component and materials suppliers. Innovation and lean manufacturing are resulting in a highly competitive wind industry, the report concludes.

Flexible Sourcing

During the past two years, more flexible sourcing strategies across the wind power supply chain have resulted in cost reductions, enabling greater geographic market access while reducing risk and ensuring profitability for wind turbine vendors and their partners in the component value chain. Overcapacity, however, persists in most, though not all areas of the supply chain, providing purchasers with more choice, flexibility, and cost control.  The report indicated that 2014’s demand was projected to be less than 47,000 megawatts while annual turbine manufacturing capacity, according to vendor estimates, was likely to exceed 71,000 megawatts.

“Oversupply is allowing wind turbine manufacturers to more easily adjust what components they produce in-house, what is outsourced, and when a blend of both is advantageous for cost, technological, or geographic reasons,” says Jesse Broehl, senior research analyst with Navigant Research.  “Although many manufacturing facilities are running at less than full capacity, product innovation, lean manufacturing and outsourcing are resulting in a highly competitive wind industry ready for the challenges of today’s and tomorrow’s wind markets.”

Blades are a particularly strong area of strategic product evolution and sourcing shifts, according to the report. Turbine manufacturers are making major, capital-intensive investment changes in how blades are designed, what materials are used, the manufacturing processes behind them, and what companies they source from.

The report, “Supply Chain Assessment 2014 – Wind Energy,” examines the significant forces shaping the global wind power industry’s supply chain.  The nearly 300-page report examines 11 component categories and profiles more than 300 component suppliers; it also identifies more than 200 suppliers across four groups of materials.

Close Examination

Analysis is provided of the top wind turbine vendors and their manufacturing capabilities, supply chain relationships, and technology strategies.  Key offerings and the capacity for leading suppliers, located primarily in North America, Europe, Asia Pacific, and Latin America, are quantified.  The report also analyzes the major technology trends within each of the component and materials categories, as well as the related manufacturing capacity and supply versus demand dynamics expected through 2018.

The report examines the improvements being made to the main components used in a wind turbine as well as how the manufacturing capacities of the key components affect supply versus demand dynamics. Additionally, it explores the component and materials suppliers that are most active in the wind power market and their offerings while also looking at the top wind turbine vendors and their manufacturing capabilities and supply chain strategies.

Other aspects of the report include a look at how strategic decisions around sourcing materials like fiberglass, carbon fiber and others are shifting. The report looks at the components that are becoming more commoditized and are being produced by lower-cost suppliers, and it also examines the ways in which regional manufacturing cost issues are affecting the wind turbine market and where cost cutting is occurring in the wind power components and materials supply chain.