SunPower said it on Wednesday it will remove 2,500 workers from its payroll, representing 25% of its total workforce. This is the second time SunPower cut jobs this year. SunPower blamed extension of installation tax credits, which eliminates immediate incentive for installing solar panels. SunPower, a San Jose-California based company is the No. 2 solar panel maker in the United States and majority owned by the French energy company Total SA.
The solar panel maker just announced last August that 1,200 workers would lose their jobs (15% of its workforce). The present cuts will be in addition to previous job reductions. Sunpower also announced shutting down its 700-megawatt fabrication factory in the Philippines; its facility in Mexico will take over the tasks of the closed factory.
According to a report by Marketwatch, the restructuring consists of inventory, 50% cuts to capital expenditures, and continued investment in next-generation solar panel technology. The company hopes to generate profits next year due to these plans, forecasting a 2017 revenue of around $2.10-$2.60 billion.
Solar panels produce electricity by absorbing sun's rays, so it produces watts of electricity without creating greenhouse gasses. However, the renewable energy market has been challenging this year due to several events. One is the low crude prices, which is barely struggling to around $50 per barrel. Cheap oil gives consumers lower incentive to purchase renewable energy sources such as solar panels. The another problem is the solar industry itself, which is rife with stiff competition that drastically drove prices of solar panels down. Last August, SunPower reported losses of $ 70 million, down the $6.5 million profit posted last year.
The stock of SunPower (NASDAQ: SPWR) has been in decline since the start of 2016, from a lofty $30 to $6.30 on November. It rose to $7.95 (Dec 7, 7:59 PM EST), up from its previous close of $6.96.
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