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Taiwan’s cell makers: A$44.8 bn loan, new layoffs and falling shares


Taiwan’s cell makers: A$44.8 bn loan, new layoffs and falling shares

In the latest news emerging from the struggling world of Taiwanese solar cell makers, Motech has announced more layoffs, and a NT$4.8 billion loan; GET has let 203 employees go; and shares of the new UREC merger are said to be down. India’s safeguard tariffs are also hitting the country’s manufacturers hard.

China’s 31/5 policy change, and India’s 25% safeguard tariffs are wreaking havoc on Taiwan’s solar cell manufacturers.

The latest in a string of negative announcements, Motech Industries Inc. has said more jobs will go – 60 according to local media – in addition to the around 300 workers it laid off in September, and the scaling back of capacity.

“Facing severe challenges and difficulties in the solar industry recently, the Company has implemented multiple plans to reorganize and adjust the corporate strategy,” said Motech in a filing to the Taiwan Stock Exchange (TWSE) on September 25. “Considering the current operational situation, the Company attempts to downsize the supporting personnel resources, after the adjustment of   production capacity, approximately 2% of total employees, so as to lower total cost and improve our operation efficiency,” it continued.

Today, in another TWSE filing, Motech says it has received a NT$4.8 billion (US$157.3 million), three year loan from the Changhwa Commercial Bank and eight other syndicated loan consortium, “To refinance existing loan and to replenish working capital.”

In another statement, released on September 28, Green Energy Technology Inc. said it was letting 203 workers at its Southern Taiwan Park factory go in response to the current “market volatility”, and to “adjust effectively production capacity and enhance the company’s competitiveness and operational performance.”

“In order to keep the Company’s core competitiveness, GET actively develops new generation of smart power and automated manufacturing technologies to enhance production efficiency and product competitiveness, hoping to make GET a long lasting energy company,” it added.

UREC merger

Today officially marks the day Neo Solar Power Energy Corp. (NSP), Gintech Energy Corporation and Solartech Energy Corp. join forces to become the United Renewable Energy Company (UREC). However, the new company did not get off to quite the start it will have been hoping for.

Indeed, Focus Taiwan News Channel reports that shares of the new company have already slipped – 2.86% to NT$10.20 (US$0.33) – on the back of the global supply glut, resulting from China’s PV policy turnaround, and nervousness around the aforementioned layoffs and restructuring announcements.

The three companies are aiming at vertical integration, from wafer manufacturing to module supply, as well as further downstream into project management. Analysts expect UREC to initially focus on Taiwan’s domestic market, which has set an ambitious target of 20 GW of solar installations by 2025.

At over 4.5 GW, the combined production capacity of the new company, however, exceeds local demand. As such, the company also has set its sights on other, global markets and on reducing the industry’s dependence on modules from mainland China.

WTO wrangle

In addition to the effects of China’s policy change, Taiwanese cell makers are also struggling to deal with India’s recently imposed safeguard tariffs on imports of solar cells, whether or not assembled in modules. Indeed, Taiwan is India’s third largest PV components supplier, next only to China and Malaysia. In 2017, it exported US$100 million worth of PV components to India.

The country has now joined Malaysia in requesting consultations with India via the World Trade Organization (WTO). Taiwan seeks to hold consultations “as soon as possible and looks forward to India’s positive response to this request,” reads the WTO notification, accessed by pv magazine India.

Source PV Magazine

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