SunPower Corporation (SunPower) has announced its split into two separate companies.SunPower will continue to be a decentralized power generation company, while the new company Maxeon Solar Technologies (Maxeon Solar) will focus on manufacturing solar modules.
Why this sudden division? How will it affect the solar market? Will this affect the amount customers pay for solar panels? We answer these and other questions.
SunPower and Maxeon Solar will separate in the second quarter of 2020.
The split was made possible thanks to a $298 million investment from Tianjin Zhonghuan Semiconductor Co. (TZS). TZS has been a partner of SunPower for many years and is one of the world’s leading suppliers of silicon wafers.
This transaction will also simplify the two organizational structures, reduce costs, improve efficiency and create more agile businesses,” said Tom Werner, CEO of SunPower, during a conference call on November 11.
By splitting it into two separate companies, SunPower can focus on expanding the services it provides to consumers.
The new and improved SunPower
SunPower provides consumers with energy solutions by helping them design, implement, and monitor their solar projects. Upon the separation of the companies, SunPower will no longer manufacture solar modules. However, it will continue to provide the same solar services to customers.
SunPower Corporation has a network of over 500 dealers with whom it works. To be part of the network, solar installers must undergo special training and meet different installation criteria.
The company then helps customers contact these dealers to facilitate solar projects. SunPower also offers solar leases to help customers finance their solar systems.>
The revised version of SunPower plans to expand its services by expanding into the storage market for solar batteries. Battery storage is expected to become more common over the next few years, which will give SunPower the potential to grow significantly in the energy storage industry.
The beginnings of Maxeon Solar
“Maxeon Solar is essentially a technological innovation company,” said Jeff Waters, future CEO of Maxeon Solar. Waters is the current CEO of SunPower’s technology operations.
Maxeon Solar will be the company responsible for manufacturing the highly efficient solar modules for which SunPower is renowned. The company will be based in Singapore and will have factories in France, Malaysia, Mexico and the Philippines.
The new locations allow Maxeon Solar to use profitable manufacturing processes throughout Asia. In addition, the partnership with TZS Maxeon Solar provides access to TZS supply chain relationships.
What is the agenda for Maxeon Solar?
One of the manufacturer’s first projects involved the development of the new Maxeon 6 solar module. Early plans indicate that the model is made by simple, inexpensive manufacturing processes.
The processes would lower the price of the panel while maintaining a solar cell efficiency of 26%.
SunPower and Maxeon are expected to sign an exclusive multi-year supply contract that will ensure the deployment and distribution of Maxeon solar modules in the United States.
However, Maxeon Solar is targeting beyond the United States. The United States and Canada are also trying to enter the world market. Using inexpensive manufacturing, they can make inexpensive and highly efficient panels while becoming a global competitor.
SunPower was unlikely to benefit from cheap manufacturing overseas because the Trump administration had imposed tariffs on imported solar panels. Maxeon Solar has recognized that this can also work outside the United States. In the United States, they have to make inexpensive solar panels, which is much more convenient internationally.
How does the Sunpower division affect investors?
SunPower Corporation is a listed company, which means that its property is organized into shares held by investors. Current shareholders will receive 71% of the shares of Maxeon Solar when the company goes public.
SunPower’s shares have fluctuated considerably in the past. Following the announcement by Maxeon Solar, the SunPower share price increased by approximately.