Germanys SMA announced yesterday that it is to cut 1,600 jobs between now and the end of June in response to increased global competition and poor demand in its chief European markets.
The company which is the worlds largest inverter supplier in terms of market share announced in July last year that it would lay off 600 staff at the end of 2015, but this latest announcement would see approximately one-third of SMAs 4,667 employees lose their jobs by the midway point of this year. Most job cuts some 1,300 will be made in Germany.
SMAs CEO Pierre-Pascal Urbon also stated that he does not expect the company to return to profit this year, revealing that further details of SMAs planned restructuring and a revised forecast for 2015 would be unveiled this Friday.
The past two years have severely damaged SMAs strength in the global inverter market. In 2012 the company had 24% of global revenue share, according to IHS, but in 2013 saw its share tumble to just 16% of the market.
Last year, SMA remained the leading supplier with 11%, but has had to face up to a serious challenge from Asian rivals, particularly Japans Omron and Tabuchi.
"We expect to see high price pressure on the global PV market still in the coming years and a further decline in demand in Europe, particularly in Germany," said Urbon in a statement. "By contrast, the non-European markets will develop positively. This means, that although the market measured in gigawatts will continue to grow in the medium term, we expect to see a global decline when measured in euros.
"To return to profitability in this environment, we want to make adjustments to SMAs structures in line with the lower sales level. This is the only way that we can break even with reduced sales. In this context, global staff reductions are unfortunately unavoidable."
The CEO added that SMA would be holding discussions with its employees over the coming weeks, but warned that compulsory redundancies may be required.
Despite facing another loss in 2015 to follow last years fiscal deficit of around 115 million, SMA confirmed that it would not require external financial assistance for its restructuring program, revealing that it has a net cash position of around 220 million ($248 million).
The company will publish its 2014 financial results on March 26.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: firstname.lastname@example.org.