Enphase pulls out of European smart microinverter manufacturing
US smart microinverter pioneer Enphase Energy is pulling its manufacturing out of Europe as it lays off 10% of its workforce.
Enphase will move all its manufacturing equipment out of the plant in Timisoara, Romania run by contract manufacturer Flex. The company is also moving US production from Wisconsin to its two other plants in South Carolina and Texas. This will see capacity of approximately 7.25 million microinverter units per quarter, of which approximately 5 million units of capacity will be in the US. The remaining production is in Mexico and India.
The move sees 350 staff laid off in the week before Christmas as part of a $18m restructuring plan. This is down to the deteriorating market conditions and higher inventories in Europe says Badri Kothandaraman, President and CEO of Enphase Energy.
“Over the last 12 months, the solar market has seen a lot of turbulence worldwide. We saw tremendous growth in Europe until the middle of 2023, when demand slowed, and interest rates led to high inventory levels. In the United States, high interest rates have caused a significant drop in consumer demand. These challenges have caused our topline revenue to decrease,” he said.
“Our focus in the first half of 2024 will be on clearing the excess inventory in the channel worldwide. Our worldwide microinverter contract manufacturing operations currently have a combined capacity of approximately 10 million units per quarter. We are planning to reduce that capacity to approximately 7.25 million units per quarter to be closer aligned to the expected demand.”
Initial shipments from the recently opened Romania factory were the IQ7 family of microinverters this summer and Enphase also announced the launch of its IQ8 Microinverters in France and the Netherlands after their launch in North America in 2021. These were also to be made at Timisoara.
“Our expanded manufacturing agreement with Enphase is a testament to our mutual commitment to provide high-quality and reliable microinverter-based systems to address Europe’s solar industry needs,” said Revathi Advaithi, CEO at Flex when the plant opened in March 2022. “We appreciate the trust Enphase has placed in Flex through our nearly 15-year partnership and look forward to quickly ramping in-region advanced manufacturing with sustainable practices.”
“During this challenging phase, we must return to our basics, and become leaner and more efficient,” said Kothandaraman at Enphase. “Our overall strategy is still the same—to make best-in-class home energy systems, continue to innovate on new technology, and deliver high quality products and a superior customer experience,” he added.
Keeping our singular focus on delivering high-quality home energy systems, we decided to consolidate our product and engineering operations across business units for efficiency and strategic alignment.
“We are looking to cut expenses further by consolidating facilities across our worldwide sites to reduce our real-estate footprint, minimizing capital purchases, and, with limited exceptions, extending the hiring and travel freeze through 2024.”
If you enjoyed this article, you will like the following ones: don't miss them by subscribing to :
