Sales of heat pumps are not meeting expectations, another company will lay off hundreds of employees
Sales of heat pumps continue to fall short of what companies recently expected. The largest manufacturer of these devices in Scotland, similar to earlier announcements from German manufacturers, has announced the layoff of hundreds of employees.
The British heat pump industry is facing a tough challenge as mass layoffs affect even the biggest players in the market. Mitsubishi Electric, the company operating the largest UK factory for heat pump production in Livingston, Scotland, has announced the layoff of more than 400 employees.
The factory, which employs around 1,600 people and is a key producer of heat pumps and air conditioning units in the UK, is taking this step due to a “significant drop in demand” for heat pumps. It is expected that in the coming weeks and months, the workforce will be reduced by approximately a quarter, which will have a significant impact on the local economy.
Mitsubishi has confirmed that the reason for this move is the declining interest in heat pumps, with both the British and European markets failing to sufficiently adapt to ambitious plans to increase demand. Employee representatives stated they were shocked by the news of the layoffs, especially since company management had promised just six months ago that such a step would not be taken.
The situation in Livingston, however, is not unique. German heat pump manufacturers, who are considered market leaders due to massive investments in production and research, are now facing similar problems.
The German company Viessmann has also announced the layoff of hundreds of employees. Once again, the reason is declining interest in heat pumps, which has caused the original expectations tied to Europe’s energy transition to fall short. Companies are responding to a sharp drop in orders, which is mainly due to worsening economic conditions and hesitation to transition to more sustainable heating sources.
Both of these situations signal serious problems facing the heat pump industry across Europe. Despite government support and investments in decarbonization and emission reductions, demand remains below expectations. People are still reluctant to purchase heat pumps due to their high upfront costs and concerns about operating expenses.
