PHOTON International The Photovoltaic Magazine

Sharp opens first European module factory

For a world market leader, this first foothold in Europe is rather humble: Sharp opened its module production facility in a small, abandoned shop in Wales. But it looks like the company is thinking strategically. It's very likely that Sharp will quickly expand its European operations.

	© Sharp Electronics (UK) Ltd.
Ready for further expansion: Sharp's new module factory in Wrexham has plenty of space for the addition of more production lines.

These days, a solar module production plant with an annual capacity of around 20 MW is not exactly enormous. But July 2 still could prove to be a historic date: it's the day that Sharp officially opened its module production at Llay Industrial Estate, an area on the outskirts of the Welsh town of Wrexham. Takashi Tomita, director of Sharp's solar systems group, is not the only one who believes the world market leader's first step into European PV production is the beginning of a story with many sequels: »This factory is only the first spark for the EU; we already are planning our next step, and then the step after the next step.« And when asked whether Sharp has considered the possibility of producing solar cells in Europe, the answer is accompanied with a slightly mischievous smile: »As of now we don't have any plans, but we have to remain flexible.«

In light of these possibilities, it's understandable that Sharp invited dozens of representatives from the PV industry and political figures to the plant opening. Since 1985, Wrexham, about a one-hour drive from Sharp's British headquarters in Manchester, has been the company's production location for microwaves and video recorders. But in recent years, Sharp's experiences in Wrexham hardly have been positive: in Oct. 2000, 60 people lost their jobs as a result of reorganization, and in March 2002, another 314 of the remaining 834-strong work force were laid off. When the decision regarding the module plant was made in Oct. 2003, only 400 employees remained at Sharp Wrexham.

Green light for expansion

But for the newly hired 63 people working at the solar factory, there's plenty to be done. The plant has been running at full capacity since March, and deliveries began in April. Work is done in three shifts, and »we're considering operating 24/7,« says Michael Williams, manager at British Sharp Electronics UK Ltd. At the opening ceremony, Toshishige Hamano, member of Sharp's company board and the director of international business, made another positive announcement: the company already had approved the option of doubling annual capacity to 40 MW. By October, a total of 110 employees will be working to produce around 20,000 solar modules per month made of 5 inch mono– and 6 inch multicrystalline cells.

Peter Hain, state secretary of the British government for Wales, exploited this piece of news – as politicians are used to do – to announce the beginning of a golden age: »Wales is laying claim to its rights as a renewable energy flagship.«

In spite of such a platitude, however, the motives are rather down to earth. For one thing, no one in either the »flagship« Wales or any other part of the UK currently is purchasing a significant amount of solar modules. The political framework conditions just don't exist. That's why the majority of modules produced in Wrexham end up in Germany.

Nevertheless, the company chose Wales, because Sharp was dedicated to implementing its decision to build a production plant in Europe as quickly as possible. That's why the company didn't construct a brand new factory, but rather chose an already existing property. After the layoffs in recent years, the shop in Wrexham offered ample space, and moreover, wage levels as well as subsidy conditions in Wrexham are among the most investor-friendly among the »old« EU countries.

The market leader's decision to be the first of all Japanese major PV module manufacturers to start module production on the Continent makes sense. Although the Japanese market is still the world's largest, growing at about 30 percent per year, Sharp's production is growing at twice that rate. Hence, Sharp is aiming to increase exports rapidly – and also the number of local module production facilities. Since Oct. 2003, a module production plant has been operating in Memphis, Tennessee with an annual capacity of 20 MW. And just like the location in Wrexham, the plant is being expanded to 40 MW this month. Also since October, a subsection of Sharp Electronics Europe GmbH was created in Hamburg specifically for distribution and marketing to Europe.

The heart of Sharp's solar department still is centered in the module factories in Osaka and Tochigi, though especially the plant in Nara, where all the company's solar cells (and some modules) are produced. On June 14, a new production line for polycrystalline cells began operation in Nara, which pushed the factory's annual capacity to more than 315 MW (see PI 7/2004, p. 55). And distribution of the annual capacity already is leaning towards export: this fiscal year, around 150 MW of product is to be sold in Japan and 160 MW in the rest of the world's markets, especially Germany and the US. The Solar Systems Group, which only recently became an independent department, increased its turnover last fiscal year by 62 percent to ¥73.2 billion ($664 million) and is geared to increase that total to ¥90 billion ($816 million) this year. But more important than this impressive growth is the fact that the solar division – should it reach this target – will contribute a notable 3.6 percent of Sharp Corporation's total turnover.