SunPower idles manufacturing lines; cuts 900 jobs


In a statement released, the U.S. photovoltaics company has said it will temporarily idle half of its solar cell production lines at its Fab 2 in the Philippines and reduce photovoltaic panel manufacturing by around 20%, thus taking its global utilization rates to roughly 60%.

Meanwhile, around 900 jobs will be cut, predominantly in the Philippines. SunPower did not disclose where the other job losses would occur. Overcapacity has been cited as a primary reason for the decision. Restructuring costs of between US$10 million and $17 million are expected to be incurred, mostly in Q4.

"Industry conditions continue to be challenging and while it is never an easy decision to reduce positions, we must make prudent decisions to effectively compete in an industry with significant overcapacity," stated CEO and president, Tom Werner.

He continued, "Additionally, we'll further our efforts to reduce costs and improve operational efficiencies. With this aggressive reorganization plan, SunPower is well positioned to lead the solar market due to our world leading technology and products, significant downstream presence in multiple end segments and ability to open new market opportunities."

By the end of the year, the company is looking to produce panels, on an efficiency adjusted basis, for less than $0.75/W. More details are expected to be made available during its Q3 earnings conference call scheduled for November 1.

In April, SunPower announced that it would consolidate manufacturing at its Fab 1 in the Philippines with Fab 2, and reduce capacity by 125 MW. At the time, the company said that it expected all 12 lines to be converted at Fab 2 by the end of 2012.

Overall, it has three fabs in the Philippines. SunPower’s Maxeon Gen E cells, which began commercial production at the end of March, are said to be a "top priority".

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