Presenting its new three-year business plan at a capital markets day, Siemens Gamesa said it would raise its margin on earnings before interest and tax (EBIT) to 8-10 percent by 2020, up from the 7-8 percent it expects for this year.

The group's announcement comes a week after Denmark's Vestas unveiled its ambitious outlook, forecasting an EBIT margin of 9-11 percent in 2018, with a mid-term target of 10 percent.

Chief Executive Markus Tacke said that the three-year plan was putting the group on track to increase profitability, "fully bearing out the merger rationale and positioning us as leaders in an increasingly competitive environment".

Shares in the group were up 2.7 percent after the announcement.

Along with its rivals, Siemens Gamesa, the result of a tie-up between Siemens' wind power business and Gamesa that was completed last year, is facing major pricing pressure as governments around the world are reining in on subsidies.

The company said that the 2 billion euros in cost reductions included a faster delivery of merger synergies, restructuring efforts and the fine-tuning of its product portfolio as well as its procurement.

(Additional reporting by Gdynia newsroom; Editing by Julien Toyer)

By Andrés González and Christoph Steitz