"Grape Solar takes wraps off expansion plans in Eugene"
on Wednesday, Grape made it clear it would like to ripen into a manufacturer with the capacity to employ as many as 200 workers in economically depressed Lane County. The company signed a lease for 53,000 square feet of factory space in Eugene, with an eye toward a $10 million plant with the capacity to churn out 100 megawatts of solar panels annually.
A faux rhino nestles in grass near an array of Grape Solar panels powering Bring Recycling in Eugene. Tom Scott, solar raconteur at Eugene's Green Store, which installed the system, says he likes Grape panels for their price and quality.RWH Oregonian
Grape Solar doesn't grow silicon crystals or make solar cells at its Eugene headquarters. Essentially, it just imports low-cost solar panels from China and re-sells them here.
But on Wednesday, Grape made it clear it would like to ripen into a manufacturer with the capacity to employ as many as 200 workers in economically depressed Lane County. The company signed a lease for 53,000 square feet of factory space in Eugene, with an eye toward a $10 million plant with the capacity to churn out 100 megawatts of solar panels annually.
Grape President Ocean Yuan said the company's sales have rocketed from zero to $20 million in the past nine months, and he's waiting to see more orders come through. But he'd eventually like to build three North American assembly plants -- in Oregon, New Jersey and Ontario -- to be closer to customers. Fully assembled solar panels are bulky and can be expensive to ship from overseas.
"We want to build a billion-dollar company in the shortest history of time," Yuan said.
Yuan's audacity and ambitious goals have provoked skepticism from established companies that make everything from the basic solar cell to finished solar panels. Instead Yuan is using a strategy he says he adopted from the electronics industry, in which different companies make cells, inverters and other parts that Grape incorporates into its panels.
Until now, Grape's panels have been assembled in China and shipped to the United States. The panels contain cells made in China, Taiwan and, sometimes, Germany.
Grape still plans to import inexpensive Chinese-made cells, and to buy Oregon-made inverters -- which convert direct current to alternating current -- for the panels it assembles in Eugene.
The point, Yuan says, is to save on shipping costs and to perform at least some manufacturing in the United States, qualifying Grape for "Made in America" requirements of the federal stimulus program, for example.
North of the border, Ontario gives advantages to companies that manufacture in its province. But Oregon doesn't plan to include local-content provisions in its forthcoming solar pilot program, which Yuan considers a mistake.
"If someone like SolarWorld builds a factory here with high overhead," Yuan said, "and then someone else imports from China, like we do, then we can compete with them on pricing, and then they're stuck."
SolarWorld, based in Germany, is preparing to assemble panels in a 100,000-square-foot addition to its Hillsboro plant, which makes cells from the first step of growing crystals out of silicon. Sanyo Solar grows crystals in Salem and slices them into wafers, which Japanese workers make into cells that go into panels in Japan, Hungary or Mexico.
Yuan, a veteran of the electronics contract-manufacturing industry, maintains that each of these steps is distinct and complex. He notes that electronics companies prefer to specialize, the approach he's adopting.
Mere final assembly won't qualify Grape, however, for state tax breaks that Sanyo, SolarWorld and others have received. Yuan says such incentives involve bureaucracy that isn't worth his time.
"We can get loans from China," he says, "with no strings attached."
Grape has applied for an interest-free loan in New Jersey, where the company might build a plant able to assemble panels with a 300 megawatt yearly capacity. Grape's planned plant in Ontario -- an area that currently accounts for about 80 percent of the company's business, Yuan says -- could reach a similar scale, employing more than 500.
Grape employs a half dozen engineers in Eugene. Economic development officials welcomed news that the company's new plant there could hire as many as 200 assembly workers. Lane County's April unemployment rate was 10.9 percent, seasonally adjusted -- slightly higher than the 10.6 percent figure statewide.
"I'm sure there'll be people that'll be lined up for these jobs," said Phillip Hudspeth, Lane Metro Partnership business development director. "We certainly want to encourage solar manufacturing here."
-- Richard Read