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First Solar ramps up production at German plants
MUNICH/DUESSELDORF (Reuters) - U.S.-based First Solar Inc (FSLR.O), the world's No. 2 maker of solar cells, will ramp up production at its German plants, scheduled to close later this year, to meet an unexpected surge in demand, a spokesman said on Tuesday.
Shares of First Solar jumped as much as 14.8 percent on the news, and were the biggest gainer among solar companies on the Nasdaq.
"We expect that we can run both plants at almost full capacity until October and slowly reduce production after that before we close them by the end of the year," the spokesman said.
First Solar said in April it would shut down its production site in Frankfurt (Oder), Germany, in the fourth quarter, as it moves its focus away from Europe, where governments have been changing subsidy policies that had boosted demand for the company's panels.
First Solar said that ramping up the site, located close to the Polish border and employing about 1,200 staff, was due to strong demand in Europe and particularly Germany, the world's largest solar market by total installed capacity.
Staff at the Frankfurt (Oder) site had been working at reduced hours since early 2012, only months after First Solar had opened its second plant there.
Solar panel manufacturers have struggled amid a steep decline in selling prices for solar equipment over the past year that has sent share prices in the sector plummeting. Several companies have gone into bankruptcy.
Solar groups, particularly in China, have rushed to build new manufacturing capacity in recent years as demand for solar panels grew. That expansion left the industry struggling with output capacity nearly double that of customer demand. The resulting inventory glut sent prices for panels down by more than half over the last year.
First Solar shares have fallen sharply so far this year, reaching a lifetime low at $11.43 earlier this month. The shares were up 11.8 percent at $13.79 at midday on Tuesday, off an earlier high at $14.16.
(Reporting by Christoph Steitz in Frankfurt and Anneli Palmen in Duesseldorf, additional reporting by Matt Daily in New York; Editing by Elaine Hardcastle and Matthew Lewis)
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