Solyndra files bankrputcy, employees sue, taxpayers screwn

[KamaAina]

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/09/06/BUF81L0R1P.DTL

The company's biggest lender was the federal government, which loaned Solyndra $528 million in 2009 to build a new factory near its Fremont headquarters. As part of an effort to boost renewable power companies, the government offered Solyndra as much as $535 million for the project, but the factory cost slightly less to build than expected.

The government will not, however, be the first creditor in line during Solyndra's bankruptcy proceedings. A $69 million loan this spring from the company's private investors will be repaid before taxpayers get their money back, according to a creditors' agreement cited in the bankruptcy filing....

Research and development engineer Peter Kohlstadt filed a class-action lawsuit against the company Friday, arguing that Solyndra violated California's WARN Act (Worker Adjustment and Retraining Notification) by laying off employees without 60-days' notice. The suit, filed in the U.S. District Court for Northern California, seeks 60-days' pay, 401(k) contributions and health benefits for the more than 1,100 employees affected, who were let go without severance....

The company couldn't compete against inexpensive cells flooding the market from new, heavily subsidized factories in China. In addition, Solyndra's foreign competitors started offering extended payment plans. As a result, some Solyndra customers refused to honor their previously agreed-upon payment terms, according to the bankruptcy filing.

In the "old economy", unfair competition from "heavily subsidized factories" overseas (e.g. Japanese steel mills) was known as "dumping" and was usually met with retaliatory measures such as tariffs on the part of the dumpees (usually us). Now, I suppose, all that has been replaced by "global harmony" or some such tommyrot. :eyes:

[yardwork]

1. This is terrible.

[ixion]

2. something is not right here

a company with 600 million cash on hand burned through said cash in a matter of 2 years?

It seems like it could have been managed with more savvy. YES, I'm speculating, but the burn rate seems wildly high to me.

The thing is that the solar panels I see coming out of China are competitively priced, e.g. not that much cheaper than US competitors, and poorly constructed, to boot. I have one, so I can speak of this first hand.