EU renewable energy blow as flagship factory 'prepares to close' for shift to US
Chinese overcapacities and Indian and US trade restrictions led to unprecedented distortion of European solar market, Meyer Burger says
Meyer Burger will shut down Europe’s largest solar module factory in Freiberg, Germany, in April unless “sufficient measures are taken to provide fair competitive conditions” in Europe, and plans to concentrate on its US manufacturing.
The Swiss solar manufacturer said it will take a final decision on the closure by the second half of February. An end to production at the Eastern German site would affect 500 employees.
The company made the plant closure threat as it announced negative earnings before taxes, interest, depreciation and amortisation (Ebitda) of at least 126m ($146m) Swiss francs for 2023, which it blames on a strong rise in Chinese excess output capacities and trade restrictions in India and the US – which had led to an unprecedented distortion of the European solar market.
A closure of Meyer Burger’s German solar panel manufacturing would be a serious setback to Europe’s plans to re-shore at least part of the solar manufacturing sector it had lost a decade ago to Chinese rivals which were helped by cheap state financing, a huge domestic market and dumping practices.
The company plans to continue producing solar cells in Germany, also to support the expansion of its module manufacturing in Goodyear, in the US state of Arizona.
“In the USA – due to the industrial policy there – we can fully exploit our leading technology position, which leads to considerable interest from potential partners,” Meyer Burger CEO Gunter Erfurt said.
“Given an order backlog of 5.4GW under offtake agreements and the possibility of achieving an Ebitda of around CHF250m in 2026, we are positioned to build a profitable business and therefore provide our shareholders with a positive outlook. The expansion of the US business is currently progressing as planned and the commissioning of our module production in Goodyear is expected to start in the second quarter of 2024.”
Meyer Burger is in talks with Germany’s economics and climate ministry on export financing guarantees and pursues additional financing options, including loans from the US Energy Department.
Mechanical engineering and R&D locations in Switzerland and Germany would not be affected by the restructuring.
(Copyright)