Bosch Finds Solar Business Unprofitable, Exits

New submitter rwise2112 writes "German engineering company Bosch said Friday that it is abandoning its solar energy business, because there is no way to make it economically viable.'We have considered the latest technological advances, cost-reduction potential and strategic alignment, and there have also been talks with potential partners,' Bosch CEO Volkmar Denner said. 'However, none of these possibilities resulted in a solution for the solar energy division that would be economically viable over the long term.'"

Comments

I love working with PV cells

[RevDisk]

But I'm also aware without government subsidies, it's not economically viable. On the large scale.

That said, I love having a solar panel on my pack when I'm out hiking. It is a nice option when you're somewhere without access to the grid.

Re:I love working with PV cells

[TemperedAlchemist]

I have a solar panel just in case all the major cities are wiped out.

That way I'll still have the internet. Right?

Re:I love working with PV cells

[Waffle Iron]

But I'm also aware without government subsidies, it's not economically viable.

Nor are most things.

Government subsidies have been a fact of life since the days of the Pharaohs.

Re:I love working with PV cells

[blue trane]

China's government subsidizes their solar companies to a much greater degree than the US does; that's why Solyndra couldn't compete.

http://www.csmonitor.com/USA/2012/0320/China-subsidized-solar-panels-US-finds.-Are-tariffs-the-right-response

the Commerce Department's International Trade Administration determined that Chinese manufacturers had apparently dumped "massive" quantities of solar panels into the US market that were sold far more cheaply than US-made panels. According to the finding, the lower price was mainly because the panels were heavily subsidized by dozens of low-cost Chinese government loan programs and other subsidies.

Re:FINANCIALLY viable

[schneidafunk]

In TFA: "European makers of solar energy have accused low cost Asian competitors, especially manufacturers from China, of creating the trouble for their western peers, partly by flooding the market with products at prices far below production costs."

Unprofitable

[schneidafunk]

The reason it is unprofitable is because China is flooding the market with panels that cost less than the production cost. If China was punished for its behavior, these companies would be able to compete and stay in business.

"European makers of solar energy have accused low cost Asian competitors, especially manufacturers from China, of creating the trouble for their western peers, partly by flooding the market with products at prices far below production costs."

Re:Unprofitable

[Ziggitz]

It's a huge problem if they selling them below their own production costs. It's a strategy to push your competitors out of a market by selling a competing product at a an unsustainable loss. When the competitor leaves the market you use your new found monopoly to ramp up the prices to extortionate rates. The outcome is almost never in the public interest.

Solar is great

[bhlowe]

I have solar and an electric car. It is an amazing combination. A 10Kw grid-tie system is now about $3/watt installed, and that drops to $2/watt after a 30% tax credit. If most new houses built included a solar panel on the roof, I could see the US becoming energy independent in a decade.

Re:Solar is great

[BLKMGK]

I looked into this myself. With the 30% credit and for a 3KW system the vendor was offering it was right around $30K using 280watt panels. My bills are actually pretty low, well below $200 on the worst month and power here is fairly cheap. The guy was figuring efficiency levels fairly low and I'd have probably done better but the payoff for this system was quite long. I decided to skip the system, the wattage potential was too low and the payoff far too long. I have a South facing home but apparently need more roof. The vendor also seemed to be pricing high and with no State incentives I just couldn't see myself doing it, I wish I could.

Bosch exiting the market isn't good IMO. They have been doing this a very long time and for them to find the business untenable really signals that the market may not be healthy. I do understand their frustration at the dumping that has occurred but if you price panels those are the ones that are actually affordable. They really need to drive prices downward or the price of electricity needs to rise a great deal before it's worth it - at least when there are so few incentives. Overall I would agree that we need to get more people into solar, yes even with Govt. incentives. Once the install hurdle is passed the damned things produce power for a good long time during peak usage hours. It simply makes sense as a nation to do this IMO but until prices to the consumer come down I don't see any mass movement in that direction :-9

Get Lockheed to do it

[TheCarp]

Seriously, do I have to think of everything?

Look you can produce a product, put it on the market, blah blah blah. Fuck that. Do what lockheed does.

1. Open a number of plants within the US, get the politicians to give speeches about how wonderful each plant will be locally. Make sure to choose towns that would be as deastated as possible by any future plant closure.

2. Lobby congress directly to buy the solar panels as a national security issue, and ignoring any irresponsible departments who claim they are not cost effective or they don't need them.

3. If #2 doesn't work right away, threaten to close individual plants, rinse and repeat until congress orders enough to ensure your profits. Be sure to tell your employees that the plant might be closing because of the uncertainty around government orders. Try to get the whole town involved.

4. Once they are buying them, get them to throw a few orders into the foriegn aid bucket. (Isreal needs solar power to keep it safe from Iran!)

5. Profit.

ENVIRONMENTALLY viable

[tlambert]

No, it's called productivity.

The manufacturing costs for manufacturing a generally similar in both Europe and China, balancing German automation + power costs vs. Chinese labor costs.

What isn't the same is the after-cost of adhering to German vs. Chinese environmental regulations.

Most industrialized nations could easily save their local manufacturing bases by imposing requirements on products being manufactured in accordance to local environmental standards in the locations they are sold. It's optional whether they would want to impose environmental tarrifs and take the product anyway, despite "dirty" manufacturing, or simply block entry of the product into the country.

For China, depending on how far up the supply chain you wanted to push the requirement, you could take it to the point of requireing scrubbers on the stacks of the coal-fired power plants that powered the manufacturing facilities.

It's ironic that environmentalism has succeeded only in moving the mess out of view (to China), rather than keeping the mess from being injected into the global ecosystem anyway. But at least health care costs tend to go down when you have no local manufacturing going on, due to a reduction in pollutants.