BP Solar Cuts 140 Jobs in Frederick; Other Area Firms Make Trims

American Woodmark plans to close its Berryville, Va., furniture plant but didn't say whether that would cost any jobs.
American Woodmark plans to close its Berryville, Va., furniture plant but didn't say whether that would cost any jobs. (By Jonathan Ernst For The Washington Post)
By V. Dion Haynes
Washington Post Staff Writer
Wednesday, April 1, 2009

The solar technology firm BP Solar said yesterday that it will sharply curtail manufacturing operations around the world, a cost-saving move that will result in the loss of 140 jobs at an assembly plant in Frederick and 480 at two factories in Madrid.

The company's reductions were among several production cuts announced yesterday by Washington area firms. Osiris Therapeutics, a Columbia firm specializing in stem cell therapy, said it was eliminating 80 jobs as it completes the sale of one of its product lines to a company that will move manufacturing elsewhere. And American Woodmark announced that it would close a furniture plant in Berryville, Va., but officials would not say how many workers -- if any -- would be let go.

The moves by BP Solar, which casts silicon into parts that are assembled into solar panels in Frederick, come as companies in the green-energy industry attempt to slash expenses in light of global economic pressures. The companies, according to analysts, are struggling to remain competitive with the price of petroleum, which has fallen from its record highs in the last several months, and are dealing with a credit crunch that has restricted consumers' ability around the world to buy the products.

"This comes at a time when solar markets are unsettled by the impact of the global economic environment, an over-supplied market, increased competition and rapidly falling prices," BP Solar chief executive Reyad Fezzani said in a statement.

BP Solar officials said the job cuts would help the company reduce product costs by 20 to 25 percent, though they declined to say how much money the company would save.

Company officials said they will halt assembly of the solar modules at plants in Frederick and Madrid, outsourcing the operations. The Frederick plant will continue work associated with casting the silicon into parts.

The outsourcing company "will end up doing the assembly and distribution in Europe and America," said Mike Petrucci, vice president for global operations, who would only say that the firm is based in the United States. "This is very similar to what the PC industry did," he said -- manufacturing the computers in-house before going outside.

Osiris Therapeutics is cutting half the workforce at its Columbia factory, eliminating 80 jobs by April 10, as it completes the sale of its Osteocel product line to San Diego company NuVasive.

Last year, NuVasive acquired the product, which grows bone from stem cells, by agreeing to pay $35 million in cash plus milestone payments of up to $50 million in cash and stock, Osiris officials said.

"We sold the product line to NuVasive," said Erica Elchin, Osiris's manager of corporate affairs. "This is a decision they made to get another company to manufacture the product."

Citing the housing slump, American Woodmark officials said they would close the Berryville factory, the oldest of three plants in Virginia. The company said it would temporarily close a plant in Tahlequah, Okla., until economic conditions improve.

"The on-going economic recession, particularly in the housing sector, has significantly reduced demand for the company's products and services," Kent Guichard, American Woodmark's president and chief executive, said in a statement. "While we have gained market share, the overall drop in consumer activity has created excess capacity that is simply too expensive to maintain."

BP officials said they expect demand to eventually grow for their products in light of the Obama administration's focus on green energy and its move to expand incentives for taxpayers to install energy-efficient products in their homes.

But for now, Brad Collins, executive director of the American Solar Energy Society, said green-energy companies are grappling with excess capacity of product not sold in Europe, which is sparking prices to plummet "in the 25 to 30 percent range."

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