The World's #1 Renewable Energy Network for News, Information, and Companies.

Suntech Reducing Solar Cell Production Capacity

Suntech Reducing Solar Cell Production Capacity

Suntech Power Holdings Co., the world's largest solar-panel manufacturer, rose the most in almost a week after temporarily reducing production capacity to lower costs amid a global oversupply.

Suntech gained 6.6 percent to 93 cents an American depositary receipt (ADR) at the close in New York, the most since Sept. 11. Each ADR represents one ordinary share.

Suntech will cut production capacity for solar cells to 1.8 gigawatts, the Wuxi, China-based company said in a statement. The company said it had 2.4 gigawatts of annual capacity in May when it released its first-quarter results. It didn’t say when it believes output would increase again.

The company isn’t reducing its 2.4 gigawatts of solar-panel production capacity, just temporarily closing the cell production portion of it. The majority of the approximately 1,500 employees affected will be offered other jobs and the rest will be fired, according to the statement.

Prices for solar cells dropped 45 percent in the past year as governments in the U.S. and Europe pared back incentives and demand slowed. Suntech faces possible tariffs in Europe, which was the largest market for the products last year, in addition to anti-dumping duties imposed in the U.S.

The cutback isn’t a surprise and more solar manufacturers will probably follow suit, said Alex Morris, a research associate at Raymond James & Associates Inc. in Houston. “Oversupply has sent prices cratering and margins as well. Right now this is just scratching the surface of that overcapacity.”

Reducing capacity will lower costs, Suntech’s Chief Executive Officer David King said in the statement.

“With these and other initiatives we target to create a sustainable business model and return to positive operating cash flow in 2013,” he said.

Copyright 2012 Bloomberg.

Lead image: 

RELATED ARTICLES

Ten clean energy stocks for 2015 June

Ten Clean Energy Stocks For 2015: Riding The Storm

Tom Konrad, Contributor The first half of 2015 saw a mild advance in the broad market, but concerns about rising interest rates and the ongoing Greek debt drama sent income stocks, clean energy, and most non-US currencies down decisively.  M...
Solar panels

US Solar Production Is Being Vastly Underreported

Vince Font, Contributing Editor Good news abounds in the solar energy industry. Recently, California became the first state to source more than five percent of its electricity from solar power. But according to the Solar Energy Industries Association (SE...
Mumbai, India

Corporate Speed Dating: Coupling India's Smart Cities with Smart Investment for Sustainability

Philip Killeen, Contributor Building off nearly 10 months of extensive public and private sector consultation, Indian Prime Minister Narendra Modi began in April to green-light initial projects under the country’s Smart Cities Initiative (S...
California flag

California Power Bill Overhaul Threatens Home Solar Growth

Mark Chediak, Bloomberg

California is poised to overhaul the way consumers pay for power in a move that could slow the growth of solar in the state.

CURRENT MAGAZINE ISSUE

Volume 18, Issue 3
1505REW_C11

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

FEATURED PARTNERS



EVENTS

2015 AREDAY Summit

The 12th Annual AREDAY Summit, August 8-13th in Snowmass Colorado. Engag...

ImagineSolar hosts SolarEdge Roadshow: Free day of Training

Free Day of Training | Lunch Included Hosted by ImagineSolar | 4000 Cave...

Training: Meeting NEC 2014 Code Compliance - Installer Challenges a...

CLICK HERE to register for a FREE expo entrance pass and ...

COMPANY BLOGS

There IS Commercial Solar Financing, If You Know Where To Look

If I have to hear one more “analyst” tell me the commercial ...

Smartcuts

Whether we’re aware of it or not, societal conventions and norms o...

How Is Your Office Set Up?

As efficiency sales professionals, we’re tuned into the non-utilit...

SOCIAL ACTIVITY

Tweet the Editors! @megcichon @jennrunyon

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS