SolarWorld AG, Europe's largest independent solar energy company has filed for insolvency in Germany due to the "difficult market environment" as low-cost panels, mostly manufactured in Asia, have glutted the global market.
SolarWorld is led Frank Asbeck, a colorful businessman known as the "Sun King" in Germany, who has led the charge against what he claims is illegal dumping of solar products by Chinese companies.
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"This is a bitter step for SolarWorld, the management board, the workforce and the solar industry in Germany," Mr. Asbeck said Thursday. "The next few weeks and months will now decide the future of Europe's largest and most modern production in the key industry of photovoltaics."
The German company, based in Bonn, also owns the largest U.S. panel manufacturing operation, which is located in Hillsboro, Ore. It received a $4 million award from the Energy Department in 2014 to develop more efficient solar cells as part of the agency's SunShot initiative.
SolarWorld's German insolvency filing, a process similar to chapter 11 bankruptcy in the U.S., comes weeks after U.S.-based Suniva, which sought bankruptcy protection in April, called on the Trump administration to declare a four-year tariff of 40 cents a watt on all foreign-made solar cells. The International Trade Commission is reviewing the petition and will decide whether to institute an investigation, which would precede any action.
Both SolarWorld and Suniva have blamed their woes on competition from Asian counterparts, which have filled the global market in recent years and pushed down prices.
"Chinese companies are undermining anti-dumping measures by the [European Union] and the [U.S.] either by relocation production to neighboring countries in Asian or by other forms of circumvention," Mr. Asbeck said.
The Obama administration imposed tariffs on solar panels and cells imported from China and Taiwan in 2012 and 2013 after SolarWorld filed a trade complaint with the U.S. government. Chinese manufacturers, which enjoy government subsidies and other financial support that give them an advantage over competitors, responded by opening new facilities in Vietnam, Thailand and other countries to get around those tariffs, analysts and solar companies say.
In 2012, pushed by SolarWorld, the European Commission launched an investigation into these Chinese manufacturers due to claims that they were receiving unfair subsidies while illegally dumping their products in Europe.
However, The Wall Street Journal reported at the time that SolarWorld itself was a beneficiary of such benefits. From 2003 to 2011 the German company was said to receive more than 137 million euros ($172 million) in government aid, according to The Journal's data in 2012.
--Peg Brickley and Cassandra Sweet contributed to this article.
Write to Lillian Rizzo at Lillian.Rizzo@wsj.com
(END) Dow Jones Newswires
May 11, 2017 17:03 ET (21:03 GMT)