Re: Solyndra's Price Tag, $733 million. Maybe more.

[Doug Canner]

On 08 May 2012, "Leroy N. Soetoro" <leroys...@usurper.org> posted
some news:XnsA04DD43A3C...@202.177.16.121:

> http://townhall.com/columnists/davidmorris/2011/10/04/solyndras_price_t
> ag/ page/full/
>
> Solyndra may have gone belly up, but at least it goes out with style.
> Constructed by union workers at a total cost of $733 million
> (proceeding from the Energy Department's $535 million loan guarantee),
> the Solyndra facility featured robots that sang Disney tunes, 19
> loading decks, and localized rail lines for moving products across its
> 300,000 square feet (approximately 5 football fields).
>
> “The new building is like the Taj Mahal,” said John Pierce, 54, a San
> Jose resident who worked as a facilities manager at Solyndra.
>
> Situated in Silicon Valley, which hadn't seen factory construction in
> 10 years given that its the 4th highest real estate area in the nation
> (and as such, most developments are simple offices), further frills
> included professional landscaping for the front, 4 electric car
> recharge stations, and a glass covered conference room. It even
> featured a fully equipped spa with state-of-the-art shower displays to
> enable employees to relax after the daily grind.
>
> Of course, the problem was that Solyndra was never worthy of profit to
> begin with. Despite the lack of demand for their signature
> "cylindrical" panel design, in 2009 such modules were touted to the
> Department of Energy as superior in the cost effectiveness of their
> construction and installation (compared to traditional flat panels,
> whose production is currently dominated by Chinese manufacturers).
>
> However, this cost advantage could hold only as long as the price of a
> primary component for flat panels, polysilicon, remained high. A
> comparable parallel would be citing a "cost advantage" for electric
> cars given the premise that oil prices never recede. This was the
> assumption in 2009, but by the time Solyndra became operational in
> January of 2011, commodity prices for flat panel components had
> plunged. Solyndra's claim of cost competitiveness with the
> conventional design of Chinese flat panels was completely nullified.
>
> Even without the price fallout, hasty construction of the factory left
> the company with equipment that proved both high maintenance and
> unreliable.
>
> “A significant percentage of the product we built went into a dumpster
> because it was defective,” said Craig Ewing, 55, a former maintenance
> technician. “It seemed like the company accepted that,” he said.
>
> Solyndra executives also neglected to perform a proper cost analysis
> on their procedures. According to solar industry analyst Peter Lynch,
> the factory spent $6 per device. To remain competitive, they would
> have to resell it at $1 to $3 per device. The mass scores of defective
> product aside, Solyndra's business model wouldn’t even cover half of
> its costs.
>
> The more we learn about the company, the harder it is to believe that
> such a waste of taxpayer money could occur. To review, without real
> demand to prop it up Solyndra's business model laid precariously on a
> presumption of high commodity prices for competitors. Creating
> products, many of which didn't even work, Solyndra soon found itself
> backlogged with overly expensive inventory. Fifteen months of decline
> later, Solyndra filed for bankruptcy protection on Sept. 6th. 1,100
> jobs "created or saved" by Obama's stimulus package went with it.
>
> As for the factory itself, taxpayers are stuck with it for the time
> being, a harrowing reminder for anyone driving down Interstate 880 in
> Fremont, California.
>

I hear Ecology auto wrecking needs some additional space.