SunPower braces itself to face COVID-19 with another set of cost-cutting measures which includes shuttering its production fabs for the time being. (Photo Credit: SunPower Corporation)
- SunPower has stopped production at all of its manufacturing facilities for the time being
- Production will be reinstated in the coming weeks, it said; existing inventory enough to meet customer demand
- Top management salaries undergo another cut and most staff to now work 4 days a week
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SunPower Corporatio has idled all its manufacturing facilities in France, Malaysia, Mexico, the Philippines and the US, the US company announced in a Securities and Exchange Commission (SEC) filing. It did not say since when the production activities have been halted.
Management said it expects the facilities to be back online in the coming weeks, again with no specific timeline mentioned. Its existing inventory will be sufficient to meet customer needs, it stated.
The step has been taken with the coronavirus impacts in mind ‘to proactively address financial and operational impacts of the COVID-19 pandemic and position itself well for when the solar industry returns to strong growth, while continuing to invest in its storage, digital initiatives, and its Maxeon 7 technology, while maintaining exceptional customer service’, reads the filing.
The company’s plan to bifurcate itself into two publicly traded companies remains on track to be completed by the end of Q2/2020, pending approvals.
SunPower has also temporarily reduced the salaries of some of its executive team to be reinstated on achieving certain financial milestones or January 1, 2021. Management has also reduced the work week for some of its employees to four days, which, however, will be open to periodic assessment to address reduced demand and workloads related to the pandemic.
With a $55 million credit revolver undrawn, SunPower is confident its existing tax equity and debt capacity is sufficient to fund all of its projects throughout 2020.
After returning to profitability in Q4/2019, in March 2020 SunPower announced salary cuts and no new hiring policy while withdrawing its 2020 guidance to deal with the industry uncertainty due to the pandemic (see SunPower Pulling All Stops To Manage Market Uncertainty).