First Solar (FSLR -1.26%) is one of the only companies using thin-film technology in solar manufacturing at mass scale. In this Motley Fool Live segment from “The High Energy Show,” recorded on June 28, Fool.com contributors Travis Hoium and Jason Hall discuss this leader in solar manufacturing.
Travis Hoium: First Solar has been a leader in solar manufacturing. They makes thin-film technology. They’re basically the only company that’s figured out how to do thin-film technology, and at mass-scale. Almost every other manufacturer in the world is using crystal and silicon, which is a similar technology, basically commoditized itself. They have a different technology than most competitors. They have managed to be profitable outside of a short, about a two-year span when they were basically tearing out all their old equipment, manufacturing equipment, and putting in new equipment. Outside of that small period of time, they’ve managed to be profitable for the last 15 years.
Jason Hall: Travis, and they made, I think it’s important too, this is a company that made a conscious decision to do that because they were accelerating their technology phase. They were basically skipping like a step change in their technology.
Travis Hoium: They went from series 4 to series 6.
Jason Hall: They were consciously making the decision to for go profits because it was going to position business so much, putting it back ahead of its competition and it had the balance sheet to be able to afford to do that, and it’s absolutely paid dividends.
Travis Hoium: Yes, and so now they are in a position where they’re profitable again, margins are solid and now they’re doubling capacity. Over the next, I guess it’s probably 2.5 years at this point, they will double capacity in the US and expand their lead as the biggest solar manufacturer in the US and then they are expanding in, I think one of their plants is in India as well. They’re not the biggest solar manufacturer in the world.
Jason Hall: They’re not trying to be there, trying to just be really good at what they do, develop those deeper relationships with the big utility-scale developers and buyers and users, and make sure their product is the best, most predictable for those environments.
Travis Hoium: As a result, those buyers are willing to pay a little bit more because they know what they’re getting.