Source: The Great Lakes IT Report
Posted: Monday, 16 March 2009
by Matt Roush
The global economic downturn is even hitting solar energy.
Rochester Hills-based Energy Conversion Devices Inc. (Nasdaq: ENER) said Monday that it will eliminate 70 jobs in solar panel production at the older of its two Auburn Hills plants based on current economic conditions.
The company also announced a two-week production hiatus effective Sunday, March 22. And it said that when it finishes the basic construction of its latest new plant in Battle Creek, it will defer the purchase of equipment and hiring of operating personnel. It's also minimizing the use of temporaries and consultants.
The company blamed "the present impact of credit availability on project flow in the global pipeline for photovoltaics.
ECD also announced that "because of the lack of visibility caused by the current economic conditions, its prior third quarter and full fiscal year 2009 guidance is no longer applicable."
That guidance, issued Feb. 9, for the third fiscal quarter now under way, had called for overall company revenue of $95 million to $110 million, of which $90 million to $105 million would come from solar product sales. That compares to revenue of $70 million in the third quarter a year earlier.
ECD said it now believes that "solar product revenue for the fiscal third quarter will approximate the results from the same period a year ago."
Said ECD president and CEO: "We are making strategic investments in our company including staffing the global sales and marketing team, strengthening customer service and broadening our government relations capabilities. We are continuing to improve our ability to serve our customers worldwide and we have flexibility to quickly respond to changes in the market. We are prudently slowing down production and expansion plans and are taking immediate action to decrease our spending and to adjust our demand-driven expansion to better align with current market conditions."
The company said it would consolidate some production from its oldest solar panel plant, Auburn Hills 1, into the newer Auburn Hills 2. About 130 employees will be relocated to Auburn Hills 2 as a result. The consolidation will result in a permanent reduction of approximately 70 positions from the remaining operations at Auburn Hills 1. These individuals will receive severance and outplacement services and will also have the opportunity to apply for future jobs at ECD facilities.
In a conference call with investors and reporters, Morelli said the Auburn Hills 1 plant will simply deposit photovoltaic chemicals on the steel substrate that forms the backbone of the ECD UniSolar flexible solar panel. All subsequent finishing work will be done in the Auburn Hills 2 plant, which has extra floor space, Morelli said.
In his statement, Morelli also sadi he remains optimistic long term.
"Even in these tough times, there are opportunities on the horizon," Morelli said. "The worldwide outlook for the alternative energy industry is tremendous, and the recent announcement of the U.S. stimulus package is excellent news. I believe the outlook for our business has never been stronger."
More at www.ovonic.com.
