Europe’s Offshore Wind Slowdown Is Squeezing Manufacturers

European monopile manufacturers expanded capacity significantly to serve the larger XXL foundations required by new offshore wind turbine designs, but the expected wave of demand has been delayed. Rystad Energy forecasts that XXL+ fabrication capacity in Europe will grow from about 1.2 million tonnes in 2024 to 2.7 million tonnes by 2027. That ramp-up, combined with project schedule slippage and slower investment decisions, leaves many factories underutilized in the near term. The consultancy projects utilization rates of roughly 32% in 2026 and 2027, dropping to about 19% in 2028 before recovering later in the decade toward nearly 50% by 2031 under the current project pipeline. That weak loading has already affected contract economics: modeled manufacturing costs in Europe have risen by about 38% since March 2020, from $2.50 million to $3.46 million per kilotonne, while selling prices have fallen from 2022 peaks as suppliers compete for future production slots. The shift has narrowed European supplier margins. For a representative 1.6 kilotonne monopile, Rystad Energy estimates the modeled margin for a European producer has declined from roughly $0.93 million in the 2024 reference case to around $0.20 million today — about 3% of the selling price. At the same time, Chinese fabrication costs are materially lower; Rystad’s modeled Chinese cost sits near $2.03 million per kilotonne, roughly 41% below the European reference. Even after adding ocean freight and the EU’s Carbon Border Adjustment Mechanism in the consultancy’s model, a Chinese monopile can be landed in Europe at about $6.35 million versus a modeled European selling price near $6.69 million for a 1.6 kilotonne unit. Europe remains dominated by domestic manufacturers—Sif accounts for roughly 31% of firm contracted monopile tonnage in Rystad’s dataset, EEW about 22%, and Dajin around 12%—but monopiles are easier to split between suppliers than turbines. That flexibility lets developers introduce additional manufacturers into tenders without assigning entire projects to a single supplier, increasing competition. Looking ahead, the current oversupply risks prompting producers to delay new investments, idle production lines, or withdraw capacity if low utilization persists, since monopile facilities carry high fixed costs. Germany’s situation underscores the uncertainty: 17.8 GW of sites were awarded for 2023–2025 but projects totalling about 16 GW could be affected by an industry-proposed voluntary site-return mechanism.