By Kari Williamson

Abound says the move is part of its plans to accelerate its manufacturing process and equipment changes needed for the production of its next generation solar thin-film modules – the AB2, 85 W module with a 12.5% efficiency.

Once manufacturing equipment has been modified and performance tested, Abound Solar expects to resume mass production with a 12.5-13% efficiency solar thin-film module by the end of 2012.

“While this is a difficult move with regards to temporarily reducing our workforce, we know that accelerating the introduction of our next generation module will bring significant benefits to our customers and allow us to create even more jobs in the future,” says Craig Witsoe, President and CEO of Abound Solar.

“Current market conditions are challenging for all US solar manufacturers, but the long-term winners will be manufacturers of the lowest cost per watt, most reliable systems. By focusing our resources to accelerate scale-up of our next generation high efficiency technology, we will sustainably lower total system costs for our customers, increase our own profitability and grow US jobs and energy security.”

Federal Loan programme failure?

Abound has nonetheless come under criticism from analysts, saying this represents another failure of the US Federal Loan programme. The company has drawn US$70 million of the US$400m of loans provided for a project to build two solar thin-film factories.

Talking to Bloomberg, Pavel Molchanov, Analyst at Raymond James & Associates Inc, says: “Abound is facing the same headwinds - cheap crystalline silicon from China - that made Solyndra a political football. … I think they made the right decision to conserve cash and focus on improving efficiency so they can ramp up when they’re ready.”

Solyndra, which was driven into bankruptcy last year, received a US$535m loan guarantee from the US Department of Energy (DoE).