Sharp says to end solar panel production in U.S. by end-March
TOKYO (Reuters) - Japan's Sharp Corp (6753.T) said on Thursday it would stop making solar panels in the United States by the end of March, extending its overhaul of unprofitable operations in response to fierce competition from low-cost Chinese rivals.
The decision is in line with a strategy devised by the electronics maker last May to recover from heavy losses across its businesses. As part of a three-year revival plan, Sharp promised to slim down its solar panel operations overseas and strengthen its display business.
The U.S. shutdown would cost about 300 jobs, or two-thirds of the workforce, at a Sharp plant in Tennessee, a source with direct knowledge of the matter said.
A Sharp spokesman said the scale of the job cuts, through voluntary retirement, was still being negotiated. The 10-year-old factory will continue to manufacture microwave ovens and toner cartridges for photocopiers, Sharp said.
The company had previously said it would stop making solar panels in Wales by the end of next month. That leaves a factory in western Japan and a joint venture with power utility Enel SpA (ENEI.MI) in Italy as its sole solar panel bases.
Sharp has been scrambling to repair its balance sheet since racking up a net loss of 545 billion yen ($5.23 billion) in the last business year through March 2013.
In its July-September second quarter, Sharp reported its first quarterly net profit in two years, thanks largely to a weaker yen. A $4.6 billion rescue arranged by banks in 2012 is contingent upon Sharp posting both an operating and net profit for the full year.
The company is scheduled to report earnings for the October-December period on February 4.
Shares in Sharp were down 0.8 percent on Thursday morning, while the benchmark Nikkei average .N225 ticked up 0.3 percent.
($1 = 104.2450 Japanese yen)
(Reporting by Reiji Murai; Writing by Chang-Ran Kim; Editing by Kenneth Maxwell)