Wacker's polysilicon division reported Wednesday that third-quarter sales were 29 percent lower than the same period last year.
Wacker has tapped the brakes on its $1.5 billion plant under construction in Bradley County, citing too much production capacity for polysilicon in the marketplace.
But company officials pledged to continue the massive project — the biggest-ever manufacturing investment in Southeast Tennessee.
"The project is going to move ahead on a continuing basis for sure," said Bill Toth, Wacker Chemical's director of corporate communications.
Wacker officials said the plant will start producing polysilicon, a key ingredient in solar panels, in mid-2015, or about 18 months later than the prior schedule.
"This time schedule brings the development of our global polysilicon capacities in line with anticipated customer demand," Wacker Group CEO Dr. Rudolf Staudigl said in a statement.
Also Wednesday, Wacker forecast a full-year profit and sales below analysts' predictions as competition from Chinese solar-products makers depresses prices.
"Sustained price competition, high inventories, the difficult financial situation of many market players and the anti-dumping proceedings against Chinese solar manufacturers currently characterize our polysilicon business," Staudigl said.
China's biggest solar panel makers are suffering losses of up to $1 for every $3 of sales this year, as panel prices have fallen by three-fourths since 2008, according to The New York Times.
Federal subsidies helped generate a network of solar panel manufacturers in the United States. But a recent Heritage Foundation study indicated that 34 solar-energy companies offered federal support have either gone bankrupt or are laying off workers as prices have slumped and demand fallen short of expectations.
The delay in building Wacker's facility will slow construction and hiring at the Charleston, Tenn., factory.
The 280 Wacker employees already hired will stay on the job and work to meet the new launch timeline, officials said.
Toth said some will spend more training time in Germany, where Wacker is headquartered.
"They'll take that time so they can gain greater knowledge and expertise," he said.
However, Wacker will adjust its hiring, Toth said. He said about 200 people are students in its Wacker Institute at Chattanooga State Community College.
"We'll have to employ some later than originally planned," he said.
Toth said plans remain for 650 workers to be on the job when production begins in 2015.
Gary Farlow, the Cleveland/Bradley Chamber of Commerce chief, said Wacker is going from "a fast track to a normal schedule" for the project.
"They didn't need to rush to market and get it completed," he said.
Farlow said a lot of companies got into polysilicon production a few years ago and capacity went up.
"There will probably be a shake-out in the industry," he said.
But Wacker takes a long view and remains optimistic about the future of polysilicon, he said.
Wacker is considered one of the industry's big four polysilicon manufacturers, alongside OCI, GCL-Poly and Hemlock, which has put a plant worth more than $1 billion near Clarksville, Tenn.
Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...