Siemens Energy shares tumbled 35% to €15.25 after the company withdrew profit guidance following a "substantial increase" in failure rates of wind turbine components.
Siemens Energy said potential costs related to the matter are likely to be in excess of €1bn.
Following the increase in failure rates of wind turbine components, the board initiated an extended technical review of Siemens Gamesa’s installed fleet and product designs.
"The current status of the technical review suggests that in order to reach the targeted product quality of certain onshore platforms, significantly higher costs will be incurred than previously assumed."
The board said productivity improvements are "not materializing to the extent previously expected" and in its Offshore business "we continue to experience ramp up challenges".
Based on its initial assessment, it withdrew guidance due to the "potential magnitude of the impact".
Analysts at Stifel said a number of London-listed renewables funds have significant exposure to Siemens wind turbines.
"At this stage, it is unclear as to whether any of the listed funds are exposed to these specific problems. In any case, we would expect the manufacturer to remedy any defects that become apparent. We think this should provide comfort to investors in the funds with significant exposure to Siemens turbines."
While awaiting full details from the listed funds on this issue in due course, analyst Iain Scouller said: "having spoken to one or two of the managers, we do expect the manufacturers' warranty obligations to cover any issues".