Solar trade row with China forces REC Silicon to cut U.S. jobs
Published Jul 02, 2018 07:29AM ET
Solar trade row with China forces REC Silicon to cut U.S. jobs
By Gwladys Fouche
OSLO (Reuters) - Norway's REC Silicon (OL:REC), a supplier of silicon materials to the solar industry, will cut around 100 U.S. jobs and take further asset impairments due to a U.S.-China trade war over solar panels, it said on Monday.
The company has been unable to sell its goods in China since 2014 as a result of the dispute between the world's two largest economies, leading to several rounds of redundancies at its two U.S. plants.
The Oslo-listed firm said on Monday it would lay off around 40 percent of the 250 employees at its Moses Lake plant in the U.S. state of Washington and cut production there to about 25 percent of capacity.
Its shares were down 14 percent at 1115 GMT, lagging an Oslo benchmark index (OSEBX) down 0.5 percent, having already fallen 68 percent over the past five years.
China has imposed tariffs on U.S. imports of polysilicon, a key element to make solar panels that REC Silicon produces, while the United States slapped tariffs on solar panel imports starting in 2012 and with a latest round in January.
The company has another U.S. plant in Montana, which is unaffected by the latest job cuts. Some 70 workers at that plant were laid off in September and 70 were laid off at the Moses Lake plant in 2016.
"It is really sad. We can't access the market. We don't want subsidies. We just want fair access," CEO Tore Torvund told a conference call.
REC Silicon also said it expected to report additional impairments when it publishes second-quarter results on July 19. Second-quarter revenue was expected at $58 million, it said, adding it had about $42 million in cash.
"Current market conditions will negatively impact the company's profitability and credit risk exposure," it said. REC Silicon did not say how much the impairments would be.
"We make a strong demand to the present (U.S.) administration to find a solution so that we can continue to operate out of the U.S.," said Torvund, reiterating calls the firm made in January, after Washington introduced 30-percent tariffs on imports of solar panels.
"We are very dependent on the U.S. administration going to the administration in China so that we can continue to operate polysilicon out of the United States," he said, adding the company was cost-competitive because it held technology others did not have.
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Written By: Reuters
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