SunPower Corp, one of the largest manufacturers of solar panels has spun off its manufacturing business to focus on roof-top solar panel installation. The new manufacturing arm, named Maxeon Solar, will be headquartered in Singapore with manufacturing facilities in the Philippines, France, Malaysia, and Mexico. The CEO of SunPower’s Technologies business unit Jeff Waters has been named Maxeon Solar’s CEO.
SunPower’s Board voted in favor of the spin-off and an equity investment of $298 million from China-based monocrystalline silicon wafer producer Tianjin Zhonghuan Semiconductor (TZS), which would give TZS approximately 28.8% initial stake in Maxeon Solar. SunPower shareholders would maintain 71.1% ownership. The deal is expected to be finalized and funds provided by TZS in the second quarter of 2020.
Tom Werner, who will remain on board as president and CEO of SunPower, said in a statement this week, “We believe that the solar industry is entering a period of extended growth where success will be driven by value chain specialization, technology innovation, and economies of scale. This new structure and investment will create two focused businesses, each with unique expertise to excel in their part of the value chain.”
The announcement comes at a time of rapid change in the solar industry. Back in September of this year, the largest U.S. solar panel manufacturer, First Solar, Inc. announced they would move away from building solar farms to focus solely on manufacturing solar panels. “As the industry gets bigger, you get companies that specialize,” SunPower Chief Executive Officer Tom Werner said in an interview. “It’s part of the mainstreaming of solar.”
The residential and commercial rooftop solar market is poised for growth. In January, a new law will take effect in California that requires solar panels to be installed on most new construction homes. According to SunPower they already have deals in place to supply panels for 18 home builders.
While SunPower will keep one small panel manufacturing facility in Oregon, the move overseas means that the U.S. will shed a large solar manufacturer even as President Trump works to bring solar manufacturing back to the U.S. through tariffs on solar equipment imports. Interestingly enough SunPower will be exempt from any import tariffs due to the efficiency of their solar panels.