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China’s Suntech to close US solar panel factory

Chinese PV developer to stop production at its only US plant in Arizona due to high costs and imposed solar cell tariffs

Suntech will stop PV production at its Arizona solar panel manufacturing facility in April 2013

Leading Chinese solar firm Suntech is to close its PV plant in the US, the company has announced. The firm, one of the world's largest producers of solar panels, will stop production at its Goodyear solar panel manufacturing facility in Arizona on April 3, 2013. Forty three employees will be affected.

 The firm said higher production costs exacerbated by import tariffs on solar cells and aluminium frames imposed by the US government, as well as global solar module oversupply, has contributed to the facility's closure. The decision is in line with Suntech's global restructuring efforts to rationalise production capacity and reduce operating expenses by 20 per cent in 2013.

E.L “Mick” McDaniel, managing director of Suntech America, said: “These are the growing pains of a maturing industry; although it's a tough time to be a solar manufacturer, there's never been a better time to be a solar customer.

“We want to thank our employees in Goodyear for their hard work and professionalism, as well as the Goodyear and Phoenix communities for their steadfast support of Suntech over the past several years,” he said.

Solar cell tariffs

On 7 November 2012, the US International Trade Commission voted to impose unilateral tariffs of 35.97 per cent on Suntech solar cells produced in China, a key component used at Suntech's Goodyear production facility. The tariffs on solar cells came in addition to tariffs imposed by the US government in 2011 on aluminium frames, another key input for solar panel manufacturing. Suntech said both tariffs have made it more challenging to cost-effectively manufacture solar modules in the US.

 Suntech's Goodyear, Arizona, manufacturing facility opened in October 2010. The facility reached peak production of 50MW per year in 2011. In November 2012, the facility's production throughput was scaled back to 15MW per year.

"Rationalising production capacity is necessary to improve our manufacturing utilisation and help Suntech to return to profitability," said David King, Suntech's chief executive officer. "We're hopeful that these tough decisions will help put Suntech back on track for growth.”

 The closure of the Suntech plant follows other BRIC companies shutting their plants. Indian wind power firm Suzlon announced it will close its rotor blade manufacturing facility in a union territory of south India in February 2013. The move followed a number of industrial relations and logistical problems associated with handling multi-MW turbine components.