Chinese solar company to close U.S. factory

Chinese manufacturer Suntech announced it will shut down its American factory, largely due to higher production costs exacerbated by import tariffs imposed by the U.S. government.

Suntech Power's Goodyear, Ariz.-based solar panel facility--a factory often held up as an example of the company's commitment to manufacturing in the U.S.--is shutting down in April.

The Chinese company blamed the closure on a global oversupply of modules and higher production costs exacerbated by import tariffs on solar cells and aluminum frames imposed by the U.S. government. The decision is in line with Suntech's global restructuring effort to reduce operating expenses 20 percent in 2013.

The U.S International Trade Commission imposed unilateral tariffs of 25.97 percent on Suntech solar cells produced in China, which are used to make panels at the Goodyear factory. The U.S. government placed a tariff on aluminum frames in 2011. Both tariffs have made it more "challenging" for Suntech to cost-effectively manufacture solar modules in the U.S., the company said in its announcement today.

The factory opened to great fanfare in 2010 and reached its peak production of 50 megawatts per year in 2011. A global glut of panels along with the tariffs, which were affirmed by the U.S. Commerce Department in October 2012, prompted the company to scale back production in November to 15 MW per year.

The trade dispute began in October 2011 after a coalition led by German manufacturer SolarWorld raised complaints and asked the Commerce Department and U.S. International Trade Commission investigate China for unfairly subsidizing its solar industry.

Photo: Suntech

This post was originally published on Smartplanet.com