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Solyndra layoffs larger than previously reported

Robert Galbraith/Reuters

On the day it closed, Solyndra said it was laying off 1,100 full-time and temporary employees.

But 1,861 workers lost their jobs as the solar panel manufacturer shut its doors, according to Labor Department documents provided to The Bay Citizen under the Freedom of Information Act.

The documents also show the Fremont-based manufacturer increased production last year, even though it failed to sell all the panels it made the year before.

By the time it closed last August, Solyndra had an unsold inventory of more than 23 megawatts – enough solar panels to power about 23,000 homes.

Analysts said the revelations are likely to add new fuel to the partisan fire surrounding the demise of Solyndra, which received a $535 million federal loan guarantee from the U.S. Department of Energy in 2009.

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“Information like this represents a great deal of ammunition for Romney and his allies,” said Dan Schnur, a former Republican political consultant who now runs the Jesse M. Unruh Institute of Politics at the University of Southern California.

Last month, Mitt Romney, the GOP presidential candidate, appeared outside the grounds of the shuttered factory with news cameras in tow and declared Solyndra to be a symbol of economic “failure.”

Two years earlier, President Barack Obama visited the company's Fremont headquarters and called its new plant, which was funded by the loan guarantee, a "testament to American ingenuity and dynamism."

In an email Tuesday, Michigan Rep. Fred Upton, the Republican chairman of the House Energy and Commerce committee, said the Labor Department documents reveal that "Solyndra was doing much, much worse" than the company and the Energy Department publicly acknowledged in the months before the company declared bankruptcy.

Upton has led a congressional investigation into Solyndra's failure. He and other Republicans have argued that the high-ranking Obama administration officials interceded on the company's behalf to get the loan guarantee.

"The more we learn by the day, the worse the news gets," he said.

The Energy Department and the White House Press Office did not respond to repeated requests for comment.

For their part, industry officials downplayed the Labor Department's findings.

“Solyndra is one firm that made some unfortunate business decisions and does not represent the rest of the vibrant, growing U.S. market,” said Tom Kimbis, spokesman for the Solar Energy Industries Association, an industry trade group.

According the Labor Department’s internal report, 1,861 workers were “separated” from Solyndra during the year it went bankrupt.

On Sept. 15, Shig Hamamatsu, Solyndra's vice president of finance, responded to a Labor Department inquiry by saying that the company had laid off 1,094 full-time employees, along with 649 temporary workers, 82 contract employees and 14 workers classified as "other." He said the company planned to lay off 22 more workers the next day. Hamamatsu said that an additional 85 U.S. employees would be laid off "when their functions are no longer needed," which would bring the total number of displaced workers to 1,946.

Previous media accounts cited 1,100 job losses at Solyndra, counting only those workers whose employment was abruptly ended the day the company shut down.

In an email, a Labor Department spokesman said the agency typically examines all layoffs during the year before a Trade Adjustment Assistance petition is filed in order to gauge the full impact of cutbacks or plant closures on a firm's workers.

The Labor Department investigated the causes of Solyndra's demise after the Alameda County Workforce Investment Board submitted a request for additional benefits for workers under the agency’s little-known Trade Adjustment Assistance program, arguing their jobs were lost as a result of competition from China.

In November, the agency ruled that Solyndra shut down because of foreign market pressure, making laid-off workers eligible for additional government assistance, including extended unemployment benefits, job training and relocation subsidies valued at up to $13,000 per worker.

To date, 52 workers have received the assistance, for a total cost of $450,000.

The Labor Department documents cite numerous examples of Solyndra losing competitive bidding processes to firms that manufacture solar panels overseas, including the home furnishing superstore Ikea, which purchased panels from the Norwegian firm REC Solar, and Wal-Mart, which opted for panels manufactured by BP Solar.

In interviews, former Solyndra employees said they weren't aware of the lost orders, but also were not surprised to hear that Solyndra’s production of solar panels far outstripped its sales.

“We would walk into the warehouse and such see piles and piles of pallets of panels, and we also heard stories of off-site warehouses,” said Michael P. Kohlstadt, who worked as a research and development engineer at Solyndra until the company folded.

“We all wondered what was happening there, and some of us asked if there were orders, but we never got a straight answer,” he said.

Multiple calls to former Solyndra officials cited in the Labor Department documents were not returned.

Since Solyndra declared bankruptcy last September, Trade Adjustment Assistance petitions have been filed on behalf of laid off workers at eight other solar manufacturers.

The Labor Department has certified five of the petitions, approving additional benefits to an estimated 339 solar industry workers, including 160 who worked at SunPower’s offices in Richmond and a CaliSolar plant in Sunnyvale.

The Labor Department denied the Trade Adjustment Assistance petition filed on behalf of workers at Abound Solar in Loveland, Colo. Petitions on behalf of workers at two companies are still pending.

In an interview, Shayle Kann, vice president of GTM Research, a leading alternative energy markets research firm, said the entire solar manufacturing industry is now contracting thanks to a global glut of production and shrinking government subsidies in Europe, which provides the largest market for many solar manufacturers, even those in the United States.

“Solyndra is not exactly alone,” Kann said. “The true context around it is that solar manufacturing is going through a contraction. It is a global phenomenon. There have been massive layoffs in Germany and even China. There is a global over-supply.”

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