We can safely assume that writer T.S. Eliot was not thinking of photovoltaic module manufacturers when he penned the opening lines of his iconic 1922 epic poem ‘The Waste Land.’
But the poem's famous declaration that ‘April is the cruellest month’ rang painfully true this year in the solar manufacturing industry. What makes the series of negative news we saw last month particularly noteworthy is that it came from some of the biggest names in the business.
These were the solar manufacturers that officially ranked at or near the top of production-volume lists and were also, unofficially, the builders of the most lavish booths (or conspicuous no-shows) on trade-show floors and the hosts of the most famous parties at the conferences we have all attended over the years.
To recap, on April 2, Germany-based Q-Cells SE announced it would file for insolvency proceedings in a German court, after posting significant losses last year and attempting to restructure its debt. No additional information on the future of the company has been provided since proceedings began, save for an announcement from Q-Cells' North American subsidiaries, which focus on project development, that they plan to continue business as usual.
Two weeks later, SunPower Corp. revealed plans to consolidate its manufacturing operations in the Philippines. The company's Fab 1 will be shut down, resulting in the reduction of 125 MW of capacity. (In the announcement, Tom Werner, SunPower's president and CEO, pointed out that this loss will be partially offset by yield improvements and its other fabs.)
The third – and perhaps most discussed – industry blow came on the heels of SunPower's announcement: Thin-film PV manufacturer First Solar said it will shut down its German factory this year, lay off 2,000-plus employees and idle several production lines in Malaysia.
The news even provoked a statement from the Solar Energy Industries Association, which noted that inconsistent policy has wounded even industry leaders like First Solar.
Is this only the beginning? As you may recall from our February 2012 cover story, titled ‘Crystalline PV Module Manufacturers Focusing On Survival Strategies,’ most analysts had predicted a major solar shakeout to occur this year.
‘Overall, although one could argue that [First Solar's] restructuring could be viewed positively for the overall solar sector (as more capacity is coming offline), we believe this is more of a sign of expected weak fundamentals in the solar sector for a longer period of time,’ wrote Deutsche Bank analyst Vishal Shah in a research note.
In other words – although we can hope otherwise – perhaps June or July will wind up being the cruelest month, after all.
This Sun Dial column was originally published in the May 2012 issue of Solar Industry.
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Editor's note: To submit your own contribution to Viewpoints, email Jessica Lillian at jlillian@solarindustrymag.com.
