Hanwha Q Cells said on Wednesday that it was closing its production site in Thalheim, Germany, and moving the fab to less expensive locations.
The group will move its cell production business from Germany to its main production site in Cyberjaya, Malaysia. It will decide on another site for module production. At present, the German fab has production capacities of 230 MW for cells and 130 MW for modules.
The company said the move was designed to improve cost and efficiency while also increasing overall competitiveness. Hanwha Q Cells' German site will cease production on March 1.
Hanwha Q Cells said it would continue its research and development operations in Germany as well as quality management of "leading technology and high quality PV products engineered in Germany" in addition to component sales and its power plant solutions business.
The company expects the move to cost some 550 jobs in Germany and said it would immediately enter into negotiations with the country's works council in order to reach an agreement on the terms and conditions of the "restructuring program." Hanwha plans to retain around 350 employees in Germany.
Hanwha attributed the move to "intensifying cost competition in the global PV industry."
Since Hanwha took over Q Cells in 2012, sales prices as well as feed-in-tariffs in international PV markets have continued to decline. "In order to mitigate these downward trends, the entire PV industry is leaving no stone unturned to achieve the most important precondition for success in solar industry — cost competitiveness," the company said.
Hanwha Q Cells Chief Financial Officer Kasey Son said the decision had not been easy "considering the impact on our employees in Germany, but it is necessary in order to ensure the overall competitiveness of Hanwha Q Cells."
Son said the decision had been made "independently" of the merger of Hanwha Q Cells and Hanwha SolarOne, which was announced in December.