SunPower Corp. has enlisted a Silicon Valley-based lender to unlock a major pot of new funding, bringing a reprieve for a firm forced to slash budgets and idle factories as COVID-19 impacts bite.
On Tuesday, the high-performance PV manufacturer unveiled a partnership that will see the Technology Credit Union (Tech CU) inject a fresh US$1 billion into the firm, with capital set to flow over the next four years.
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According to SunPower’s statement, the funds will be allocated to its solar and storage loan programme. The capital, the firm explained, will slash the firm’s operating costs by bringing down financing fees.
Tech CU’s involvement will see a financing platform offered to SunPower’s residential customers. The tool will seek to simplify the loan application and contract signing process by allowing households to compare between different cash, lease or loan acquisition plans.
Norm Taffe, SunPower’s executive VP of North American Channels, said the US$1 billion partnership will help the firm diversify its funding mix and “allow for tens of thousands of SunPower solar systems to be funded over the course of the next four years.”
US$1bn boost after forecast of deep 2020 losses
For SunPower, the lining up of a US$1 billion commitment brings positive news to an otherwise tricky start of the year, with COVID-19 disrupting its operations and those of its peers in the US solar space.
In late March, the group staged a response by announcing cost cuts of US$50 million. At the time, China’s status as initial pandemic hotspot was fuelling component shortages, coupled with impacts from the lockdowns across California, New York, Europe and SunPower’s other key downstream markets.
In late April, the firm told PV Tech it had spent the prior month gradually shutting down all of its manufacturing plants in the US, Mexico, France, Malaysia and the Philippines. The firm said it would follow the same phased approach when the time came to restart the facilities.
SunPower’s pre-COVID guidance for 2020, released in mid-February, showed pressure on its finances even before the pandemic hit. At the time, the firm predicted GAAP net losses of US$145-195 million for the fiscal year 2020, starting with US$70-85 million in Q1 2020 alone.
With market analysts await the final figure – SunPower’s Q1 2020 results are due this Thursday – the US firm is having to grapple with COVID-19’s impacts following its comeback to profitability in 2019, a year when it spun off its manufacturing operations into new listed entity Maxeon Solar .
PV Tech has set up a dedicated tracker to map out how the COVID-19 pandemic is disrupting solar supply chains worldwide. You can read the latest updates here.
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