First Solar lays off 2,000 as Europe demand wanes

NEW YORK (AP) — First Solar Inc. will lay off 2,000 workers and close its factory in Germany following a collapse in solar panel prices that has erased the industry's profits and forced some smaller companies into bankruptcy.

America's biggest solar manufacturer said the layoffs amount to 30 percent of its global workforce. It's an about-face for a company that doubled the number of employees at the Frankfurt, Germany, plant to more than 1,200 just last year. First Solar will also shutter some production in Malaysia. It plans additional job cuts in Europe and the U.S.

"The solar market has changed, and so must we," Mark Widmar, First Solar's chief financial officer, told analysts in a conference call.

The price of solar panels, which generate electricity from sunlight, has plummeted recently. An influx of Chinese competitors has led to a rapid buildup in supply. At the same time governments in Europe, the biggest market for solar power, are reducing generous subsidy programs that had fueled demand. From March to December last year, solar panel prices dropped 50 percent, said Aaron Chew, an analyst with the Maxim Group.

Cheaper solar is good news for consumers, but manufacturers are struggling to stay afloat. Last year, Solyndra LLC of Fremont, Calif., Evergreen Solar Inc. of Marlboro, Mass., and Spectrawatt Inc. of Hopewell Junction, N.Y. all declared bankruptcy.

"Nobody's making money in this business right now," Chew said.

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Europe is struggling. Without a doubt. Some will blame "austerity", but the truth is very materialistic. Money has to come from somewhere. It's science. Just goes to show you that without government subsidies (real subsidies), solar isn't viable. Maybe one day.....