April 20 (Renewables Now) - US solar cell and module maker Suniva Inc has filed for Chapter 11 bankruptcy protection, collapsing under downward pricing pressures.
Suniva recently announced a significant workforce reduction at both its facilities in Norcross, Georgia and Saginaw, Michigan, saying it has been hit by continued increases in global manufacturing overcapacity, particularly in Asia, which keep driving down prices in the US.
The company then laid off 191 of its 265 employees, according to a declaration by David M Baker, who has been appointed chief restructuring officer. It subsequently further cut staff and at the point of the bankruptcy filing on Monday had 35 workers. There are employees removing hazardous chemicals from the Georgia facility before it can be shut down. Once this is done, staff will be reduced to 11.
Suniva is majority-owned by China's Shunfeng International Clean Energy Ltd (HKG:1165), which took a 63% stake in it about a year ago. At the end of 2016, the US company announced completion of an expansion at its Georgia headquarters, increasing its manufacturing capacity to 450 MW.
According to Baker's declaration, Suniva's expansion, along with incurrence of significant additional debt, coincided with exacerbation of market pressures due to a recent drop in demand in China and the resulting production glut which further drove down global prices.
The company made net losses of USD 21.4 million (EUR 19.9m) in 2015, of USD 29.2 million in 2016 and USD 5.7 million in 2017 through February.
Shunfeng, meanwhile, posted a CNY-2.4-billion (USD 353m/EUR 329m) net loss for 2016 in part due to Suniva.
(USD 1.0 = EUR 0.932)