SunPower, facing tariffs, mulls expanding U.S. manufacturing (updated)

Solarworld AG

16/03/2018 16:54

(Adds background, details and quotes from CEO interview)
    By Nichola Groom
    March 16 (Reuters) - SunPower Corp  SPWR.O  said on Friday
it was strongly considering expanding its solar panel
manufacturing in the United States as it grapples with the Trump
administration's tariffs on solar imports.
    The news came as the company filed a request that some of
its foreign-made panels be exempted from the new 30-percent
tariffs. Friday is the deadline for companies to file such
requests.
    SunPower argued that its highly efficient, premium-priced 
solar panels could not be compared with the more conventional
models that dominate the market. The company is based in San
Jose, California but does most of its manufacturing in the
Philippines and Mexico. 
    In an interview, Chief Executive Tom Werner said the company
was not seeking an exemption for its less efficient and
expensive "P-series" panels and would likely set up a new U.S.
manufacturing plant for that product.
    An exclusion of its other products from the tariffs "just
makes it far easier to make that investment," Werner said.
    "We understand the administration's goals," he said. "We
think we can contribute positively to those objectives." 
    The new manufacturing would likely be in the Southwest, but
Werner declined to give details. It would create hundreds of
jobs, he said.
    President Donald Trump's decision in January to impose 30
percent tariffs on cheap imported panels was intended to protect
American manufacturuing jobs. However, many in the solar
industry -- including SunPower -- say the tariffs will raise
costs and trigger thousands of layoffs in the installation end
of the industry.
    It remains to be seen whether the tariffs will spur
substantial new investment in U.S. panel manufacturing. China's
JinkoSolar  JKS.N  said shortly after the tariffs were announced
in January that it was planning to build a U.S. manufacturing
facility. 
    SolarWorld, one of the panel producers behind the trade case
that resulted in the tariffs, has said it will hire 200
employees this year. Suniva, the bankrupt company that first
sought the tariffs, has not outlined its plans publicly.
    SunPower said earlier this year that it had put a $20
million factory expansion and hundreds of new jobs on hold
pending a decision on an exclusion from the tariffs. 
    If it receives the exemption, Werner said SunPower would
"materially" reverse that decision, but would not invest the
full $20 million as originally planned.
    SunPower is majority owned by France's Total SA  TOTF.PA .
Its request for an exemption from the tariffs will undergo a
30-day comment period before the U.S. Trade Representative makes
a decision.

 (Editing by Phil Berlowitz and Bernadette Baum)
 ((nichola.groom@thomsonreuters.com;))