European Solars Weigh Airbus-Style Factory to Beat China on Cost

May 20, 2014 11:25 am ET

May 20 (Bloomberg) -- A group of European solar companies may build one of the biggest solar-panel factories in an effort to beat Chinese competitors on cost in a plan reminiscent of the region’s creation of Airbus.

The companies, backed by research institutes from Germany, France and Switzerland, are considering a multi-gigawatt-sized module plant, said Karin Schneider, spokeswoman for the German Fraunhofer ISE research center, which is part of the group. Germany’s Economy Ministry said today it has been contacted about and is observing the plan “with interest.”

“Europe is leading the way on solar research and development, and the idea is to also keep production here,” Schneider said today by phone from Freiburg. She declined to name which companies are involved, saying it will publish more details “in the coming weeks.”

A joint European factory would be the latest move in a battle with China over share of the clean-energy market, which has been fraught by allegations of with dumping and economic espionage. More than a dozen German companies including Q-Cells SE, once the world’s largest cell maker, and Solar Millennium AG have filed for insolvency in the past few years as Chinese companies took market share.

The consortium plans to build a pilot plant that may start production early next year. It could be expanded to a larger, 1- billion-euro factory that could produce panels by 2018, Sueddeutsche Zeitung reported earlier today.

Countries Involved

Other research members are France’s National Solar Energy Institute and Switzerland’s Centre Suisse d’Electronique et Microtechnique SA, Schneider said. A gigawatt-sized plant could compete with its Chinese counterparts on cost and supply European and world markets, according to a study by the Fraunhofer IPA institute based in Stuttgart.

Germany, France and the U.K. in the late 1960s decided to join forces to form Airbus, now Europe’s biggest plane-maker, to rival America’s Boeing Corp., which at the time was working to consolidate its supremacy with the long-range 747 jumbo jet.

“A company with European dimension in the photovoltaics industry would be generally welcomed,” the Economy Ministry said in an e-mailed response to questions. “The chances for success of such a project depend on how far companies and investors are willing to play a part in it.”