As the nation's trade deficit grows in the face of rising exports, critics say it's time for the U.S. to take a tougher stance on China and other trade- rule violators.
By Steve Minter
In a speech at the second Conference on the Renaissance of American Manufacturing March 27 in Washington, Gordon Brinser, the president of SolarWorld Industries America, posed this question: "How can the United States continue to benefit from an open global marketplace as the vastly different system of state-sponsored capitalism in China emerges as an economic power and increasingly targets our strategic industries?"
For SolarWorld, the question is not academic. The company is embroiled in a major trade dispute with China. SolarWorld is pitted not only against Chinese competitors but an array of U.S.-based interests that benefit from cheap Chinese products and accuse SolarWorld of standing in the way of increased adoption of solar products.
Brinser said it was time for the United States to adopt a "new game plan" for trade in the face of China's economic model "designed to gut and own our key industries."
We are competitors by nature in Milwaukee, whether it's rooting on our small-market Milwaukee Brewers and Green Bay Packers or whether it's protecting our standards of living in a community that's second to none.
Helios, a Milwaukee-based solar panel manufacturing company, is competitive, too, and we deliver innovative world-class products. Lately, though, the American solar industry has been undermined by Chinese trade practices that are putting U.S. manufacturing jobs at risk.
At Helios, we believe American manufacturers certainly can compete with Chinese solar manufacturers. In fact, the U.S. Department of Energy found that, once you add in the cost of shipping, Chinese solar panels are actually more expensive to produce than American ones. However, we simply cannot compete with the Chinese government and Chinese manufacturers. It's not a pretty story.
From 2008 to 2010, China's exports of solar cells and panels to the United States jumped an astonishing 350%. How did China achieve this growth? The Chinese government was unfairly subsidizing its own solar companies to the tune of $34 billion, and Chinese manufacturers were dumping their products in the U.S. market.
A U.S. Senate report released in February outlined some of the impacts:
The U.S. trade deficit in environmental goods with China reached an all-time high in 2011. The U.S. went from a trade surplus in solar products in 2010 to a $1.6 billion deficit in 2011.
U.S. imports of solar cells and modules from China went up 135% in 2011.
European Union and Japanese exporters of environmental goods are also losing market share to China in global markets.
The results? A 40% collapse in prices in the past year forced 12 American plants to close or downsize during the past 18 months.
Milwaukee-based high-efficiency monocrystalline PV module manufacturer, Helios Solar Works is the first founding member of the Coalition for American Solar Manufacturing (CASM), outside SolarWorld to declare itself a supporter of actions that will lead to duties being applied to solar cells and modules from China. Seven firms with manufacturing operations in the US were said to have formed CASM and petitioned US agencies to investigate module dumping allegations, though until now only SolarWorld, which has led the campaign, had declared involvement.
“We have supported these trade cases from the beginning, and we are pleased to publicly declare that support,” said Steve Ostrenga, chief executive officer of Helios Solar Works, headquarterd in Milwaukee.“Our country can’t afford to give up manufacturing jobs in growth industries to nations that engage in illegal and harmful trade practices.”
According to a statement from CASM, Helios Solar Works was forced to downsize its manufacturing operations as a result of dumped and subsidized Chinese imports of solar cells and modules.
New Hampshire, U.S.A. -- Helios Solar Works, a small solar panel manufacturer based in Milwaukee, Wisc., said Thursday that it is one of the seven companies that worked to file the original trade complaint against the price of solar panels coming in from China.
Until this week, SolarWorld was the lone public face for the Coalition for American Solar Manufacturing (CASM). The Department of Commerce is expected to announce its preliminary countervailing duty determination as early as March 19 just as the solar industry arrives at PV America-West, a three-day conference and exhibition in San Jose, Calif., that runs March 19-21. The result could impose stiff tariffs on panels coming in from China, and such a move would put severe financial pressure on the rest of the American solar industry that has often benefited from the low-cost panels. It would also make American-made modules more cost-competitive.
The remaining five companies in the seven-member coalition remain anonymous, and there is no requirement that their names ever be made public. However Helios Solar Works decided the timing was right, even as the tariff decision looms and as the rhetoric with the competing Coalition for American Solar Energy (CASE) intensifies.
Helios Solar Works of Milwaukee has been forced to cut jobs as it struggles to compete with imported solar panels from China that are the subject of an international trade dispute.
Helios opened its solar panel factory in the Menomonee River Valley one year ago and expanded to two production shifts by the summer. Its growth path was thwarted because of panels that were being sold in the United States at prices below the cost of production, Helios and a coalition of solar manufacturers contend.
The company is joining a solar industry effort to protest what they see as unfair trade practices, lining up behind SolarWorld, which led a coalition of solar companies that filed a complaint on the matter last year.
In December, the U.S. International Trade Commission voted unanimously that "there is a reasonable indication that a U.S. industry is materially injured by reason of imports of crystalline silicon photovoltaic cells and modules from China that are allegedly subsidized and sold in the United States at less than fair value."
Demand was initially brisk for the high-end monocrystalline silicon solar photovoltaic (PV) panels manufactured by Helios Solar Works at a new, highly automated 50-MW capacity factory on a brownfield industrial site Milwaukee’s city leaders designated for redevelopment and growth. That is until last summer, when founder Steven Ostrenga began noticing “a deep dive in [solar panel] pricing coming out of China that we just couldn’t meet.”
Helios’ silicon solar PV manufacturing business got off to a good start, and the company added a second shift, bringing its workforce to 34 as of last summer. That’s when heavily subsidized imports from China really began surging into the US market, bringing prices below Helios’ cost of production, as well as the cost of production in China, Helios and fellow Coalition for American Solar Manufacturing
(CASM) members assert in anti-dumping and unfair trade petitions filed with the US Commerce Dept. and International Trade Commission.
Competition is fine and good; it's a prerequisite for a healthy, market-based capitalist system, but China's been flaunting agreed-upon international trade rules established by the World Trade Organization (WTO), harming competitors in the US and other WTO countries, Helios and CASM assert.