SunPower Corp. on Wednesday said it would buy U.S. solar panel maker SolarWorld Americas, expanding its domestic manufacturing as it seeks to stem the impact of Trump administration tariffs on panel imports.
The White House cheered the deal, saying it was proof that Trump’s trade policies were stimulating U.S. investment.
Terms of the transaction were not disclosed.
The news sent SunPower’s shares up 12 percent on the Nasdaq to their highest level since before President Donald Trump imposed 30 percent tariffs on imported solar panels in January.
“The time is right for SunPower to invest in U.S. manufacturing,” chief executive Tom Werner said in a statement.
SunPower is based in San Jose, California, but most of its manufacturing is in the Philippines and Mexico. The company had lobbied heavily against the solar trade case brought last year by U.S. manufacturers, including SolarWorld, which said they could not compete with a flood of cheap imports.
‘This is great news’
The deal is a win for the Trump administration’s efforts to revive U.S. solar manufacturing through the tariffs. SunPower will manufacture its cheaper “P-series” panels, which more directly compete with Chinese products, at the SolarWorld factory in Hillsboro, Oregon, it said. It will also make SolarWorld’s legacy products.
“This is great news for the hundreds of Americans working at SolarWorld’s factory in Oregon and is further proof that the president’s trade policies are bringing investment back to the United States,” White House deputy press secretary Lindsay Walters said in an emailed statement.
The announcement comes as SunPower is seeking an exemption from tariffs on its higher-priced, more efficient panels manufactured overseas. It has argued to the U.S. trade representative, which will make a decision on exemptions in the coming weeks, that those products should be excluded because there is no U.S. competitor that makes a similar product.
In a note to clients, Baird analyst Ben Kallo said the SolarWorld deal would enable the company to compete against Chinese imports should SunPower’s products not receive an exemption. But he added that skeptics “may question the company’s ability to generate profits with U.S. manufacturing.”
The deal will inject much-needed capital into SolarWorld’s long-suffering manufacturing plant and give it the support of a major market player. SunPower is one of the largest solar companies in the world and is majority owned by France’s deep-pocketed oil giant Total SA.
The U.S. arm of Germany’s SolarWorld AG opened the Hillsboro factory in 2008 as it sought to capitalize on surging solar demand in the United States. But its start coincided with a dramatic increase in the production of cheaper solar products in Asia, and SolarWorld struggled to compete.
Twice, in 2012 and 2014, trade cases brought by SolarWorld prompted the U.S. Commerce Department to slap import duties on solar products from China and Taiwan. Yet prices on solar panels continued their free fall, and in 2017, the company joined rival Suniva in asking for new tariffs.
SolarWorld called the outcome “ideal” for its hundreds of employees in Hillsboro.
Suniva’s future in doubt
During the trade case and after the tariffs were announced, the solar industry’s trade group, the Solar Energy Industries Association, argued that the tariffs would not be enough to keep SolarWorld and Suniva afloat.
Indeed, Suniva’s future remains uncertain after a U.S. bankruptcy court judge this week granted a request by its biggest creditor that will allow it to sell a portion of the company’s solar manufacturing equipment through a public