TPI Composites is an only independent manufacturer of composite wind blades with a global footprint

On 30 May, the Ministry of Home Affairs (MHA) issued an order to further extend the lockdown until 30 June 2020, their will be an ease of lockdown restrictions under the country’s re-opening strategy, beginning with Unlock Phase 1. All activities that were prohibited  previously will be opened in areas outside Containment Zones in a phased manner. 
The Wind Energy OEMs Vestas /Suzlon/Inox/SGRE /Senvion/Nordex, including the SCM companies have resumed operations at all their manufacturing sites across the country, in compliance with all safety guidelines and directives issued by the Central and State Governments and local administration to safeguard the employees and all other stakeholders to prevent the spread of COVID-19. Nevertheless, the production level is still at 25-30%.
Ramping up production is challenging as most of the inward raw materials from suppliers or the components have not reached the facilities due to persisting inter-State transport challenge or logistic movement. However, inter-state and intra-state movement of people and goods will be permitted from 1 June without any permission or e-pass. The workforce, who have returned to the rural areas/hometown during the lockdown period, have not returned to the manufacturing facilities, which also adds additional constrain in the manpower production planning. 
Aside from challenges on the supply side, project development planning is also disrupted in India. This is due to challenges faced in movement of Heavy machinery from one state to another or at project sites themselves. Wind technical engineers reaching the sites due to restrictions under the containment zone areas will further delay the project schedules and O&M activities. Moreover, SECI has, again, extended bidding deadlines for its 2 GW wind tenders from 26 May 2020 to 11 June 2020.
To revive the COVID-19 hit economy, the Government of India announced a INR Rs 20 lakh crore stimulus package, representing around 10 per cent of the country’s GDP. Included in this package is a Rs 90,000-crore liquidity injection into power distribution companies, or Discoms, who have been facing liquidity issues due to a significant drop in energy demand during the lockdown. This stimulus will be important for the energy sector, as will revive the liquidity of Discoms to increase their ability to pay power generators and create a healthy energy sector.
Additionally, Central Power Minister Mr. R.K. Singh highlighted that Central Public Sector Undertaking (PSU) generators are asked to waive fixed charges against power not drawn by Discoms. The power generators will also benefit from this package, with the option to pay these charges in three equal installments without any interest.
Focus on: TPI Composites
TPI Composites is an only independent manufacturer of composite wind blades with a global footprint. Like many other companies, TPI has withdrawn its financial guidance issued on 27 February 2020 and updated on 3 April 2020 for the fiscal year ending 31 December 2020. The company stated the uncertainty on the impact of the COVID-19 crisis on its manufacturing operations related to the rapidly evolving nature, magnitude and duration of the COVID-19 outbreak as well as the variety of measures implemented by governments around the world to address the crisis. COVID-19’s impact on TPI’s major blade manufacturing facilities is represented in the map below.
In China, TPI’s manufacturing facilities have resumed their operations after an extended Spring Festival holiday due to COVID-19 outbreak. Although the number of deliveries is expected to exceed the company’s original forecast for the year, TPI reported a net loss of $9 million in Q1 2020, without including $2 million in income taxes. This is primarily due to reduced production levels at their China manufacturing facilities as a result of the lockdown in the country earlier in the year.
TPI’s Indian manufacturing facility located in Chennai, Tamil Nadu has slowly begun resuming operations with limited production as India’s lockdown measures have started to ease for industrial sectors. However, the shutdown of this facility will have minimal financial impact on the company limited as the plant is a relatively new investment. 
In Turkey, TPI operated its manufacturing plant in Izmir with approximately 50 per cent production capacity during the first half of April upon request of the Turkish government to stem the spread of the virus. Due to global supply chain disruptions, its plant in Turkey was affected by the shortage of blade core materials and approximately two weeks of production will be lost in Q2 2020 as a result.
At TPI’s Matamoros plant in Mexico, the facility is currently operating at approximately 50 per cent capacity, and may be required to continue operating at reduced capacity through to the end of May, at which time the Mexican government has indicated that they will lift the “sanitary emergency”. TPI expects that blade production in the second quarter will be negatively affected, as its four factories in Juarez may also continue to be shut down. While the company is actively engaging with customers and the Mexican government to resolve uncertainty around what constitutes an “essential business” under the lockdown measures.
In the US, TPI’s facility in Newton, Iowa shut down on 23 April because of the increase in the number of COVID-19 diagnoses in surrounding counties, including colleagues who worked at the plant. It has restarted operations with limited production on the 4 May, implementing a mandatory COVID-19 testing programme for all new Iowa employees. The company’s other US facility Rhode Island has not been affected by the COVID-19 crisis. 
It is expected that raw material suppliers will be affected by COVID-19 and a tight supply of core materials will continue due to the lockdown in Ecuador, a major exporter of balsa wood which is a key component in turbine blades.  TPI’s working capital in Q2 will be significantly affected by the loss of sales in Turkey, nevertheless, temporary shutdowns of factories in Iowa and Mexico have increased inventory levels. According to TPI Composites, there is no significant material impact to date, but there is a risk around balance of the year. However, the company remains optimistic as its demand remains strong despite the crisis as the reduction in wind power installations in 2020 will be spilled over into 2021.
TPI Composites has called for a global green recovery from COVID-19, signing  the Global Wind Industry Statement on Green Recovery launched by GWEC together with signatories representing all the major wind industry corporates and associations across the world. The statement highlights wind power’s role in the global economic recovery following the COVID-19 crisis and lays out the key policy actions that must be put into motion in order to realise a sustainable economic recovery.