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TOKYO, Oct 16 (Reuters) - Japan’s Nippon Sheet Glass (5202.T) said on Thursday it has been modifying its U.S. plants to boost solar cell glass output but voiced concerns about missing business chances as demand will likely grow faster than it can keep up with.
Nippon Sheet Glass, which competes with Japan’s Asahi Glass Co Ltd (5201.T), France’s Saint-Gobain (SGOB.PA) and U.S.-based Guardian, sees glass used to make solar power equipment as a growth driver amid booming demand for renewable energy sources.
“The issue is not the lack of growth opportunity. The issue is in the business decision that we make,” Nippon Sheet CEO Stuart Chambers told reporters, citing the outlook for solar cell glass demand to jump some seven times in five years.
“It’s very, very difficult for us to be able to invest fast enough to keep pace with capacity demands of our customers, and therefore we’ve got a bit of a concern in about three years time we are going to have a real problem supplying enough,” he said. Nippon Sheet Glass generated a little over 1 percent of its annual revenues from selling solar cell glass last business year, while 90 percent of revenues still came from its two main divisions -- building products and automotive glass.
The company has six float lines in the United States, which can be modified to produce solar cell glass much cheaper than building a new factory from scratch. Chambers did not discuss in detail the firm’s investment plans for the solar cell glass business.
Nippon Sheet could face extra hurdles to make new investments because it still has net debt of around 320 billion yen ($3.2 billion) from its acquisition of British glass maker Pilkington in 2006.
Chambers, a British national, became the glass maker’s CEO in June, joining Nissan Motor’s (7201.T) Carlos Ghosn and Sony Corp’s (6758.T) Howard Stringer as one of the few non-Japanese to lead a Japanese firm. (Reporting by Sachi Izumi; Editing by Michael Watson)