Many of about 50 SolarWorld workers who will lose their jobs late this summer will be eligible for federal “trade-adjustment” assistance because the U.S. Department of Labor has determined that Chinese solar-panel imports were a cause of their impending layoffs, the company announced on July 22nd, 2013.
Many of the laid-off workers, most of whom grow silicon crystal and cut crystals into solar wafers in SolarWorld’s factory in Hillsboro, Ore., will be able to tap benefits such as job-placement assistance; expenses for job searches, relocation and retraining; income support during full-time retraining; and tax credits for health-insurance premiums.
SolarWorld says it is idling the crystallization and wafering departments in Hillsboro as the company develops ground-breaking, cost-reducing technologies in factories in both Hillsboro and Germany. Meantime, SolarWorld says, China’s sustained solar import dumping on the U.S. market means the company can no longer continue to produce solar wafers in Hillsboro using conventional crystallization methods. Without dumping and subsidies, China has no cost advantage over U.S. manufacturers on wafers or any other aspect of solar production.
Chinese solar cell and panel imports are subject to tariffs averaging about 31 percent as a result of exhaustive, 13-month federal investigations concluded in late 2012. Those probes found China’s government illegally underwrites its solar export aggression and its state-sponsored producers illegally sell below production costs in the U.S. market. A loophole in the U.S. determinations, however, means that Chinese producers can evade duties by making panels in China using solar cells from other countries.
The loophole, which SolarWorld is appealing to the U.S. Court of International Trade, stands even as China subsidizes every phase of solar-panel production, including wafer-making and panel assembly, to fuel its dumping campaign, according to the company. Government subsidies for exports, it says, are illegal under world trade rules.
Industry statistics, the company says, demonstrate that the Chinese industry has continued to harm the U.S. market with products from its vastly overbuilt industry by selling them even further below costs. A report from Greentech Media and the Solar Energy Industries Association released in the spring shows that Chinese-led solar panel pricing in the U.S. market has fallen about 8 percent a quarter since SolarWorld requested the federal trade investigations. These price declines, according to SolarWorld, cannot be explained by technology or efficiency improvements.
Meantime, SolarWorld says, China’s illegal trade practices have destroyed additional U.S. capital and jobs, dried up yet more corporate funding for innovation and further slowed the industry’s development, which fair international competition had driven to the recent point of market adoption when China’s economic planners targeted the industry for domination. In the end, the company says, consumers could suffer most: If China eliminates U.S. competition, it would be forced to jack up prices to offset massive losses.
The Chinese producers’ own ruinous financial results, SolarWorld says, detail how much they, too, suffer from the very market distortions that their illegal trade practices create. However, the company says China’s government continues to prop them up, extending the market distortions and resulting industry carnage outside of China.
“All of our workers had one thing in common: They are committed to U.S. manufacturing jobs in the very industry that their American peers helped pioneer,” said Gordon Brinser, president of SolarWorld Industries America Inc., based in Hillsboro. “It’s doubly wrenching, therefore, that we have been forced to lay them off as a result of China’s unfair, illegal and unsustainable trade practices.
“We look forward to a day when China’s illegal and retaliatory trade actions are stopped, so that SolarWorld’s U.S. operations can expand, rehire, and lead the next generation of solar innovation.”