German solar company Q-Cells recently filed for bankruptcy, but works council chairman Uwe Schmorl still believes in the company's future.
The white sign at the Bitterfeld-Wolfen highway exit, between Leipzig and Berlin, still looks like new. Two further signs lead from the exit to the imposing main gate of the so-called "Solar Valley."
It's here, on a 300-hectare (740-acre) fenced area in Saxony-Anhalt, that Germany's photovoltaic manufacturer Q-Cells established itself over the last decade. White flags bearing the blue and white logo still fly in front of the three glass office towers of the company's headquarters, looking as if they've just been hung.
Despite bankruptcy, a surprisingly good mood
There is no indication that Q-Cells, formerly the world's largest solar cell manufacturer, filed for bankruptcy last week. In fact, Uwe Schmorl, the company's works council chairman, seems almost cheerful.
He described the mood last Wednesday, at the first staff meeting after the bankruptcy, as "surprisingly good." Jokes were told, and CEO Nedim Cen was even applauded when he told his workers that the bankruptcy had nothing to do with their sensational work.
But the approximately 1,200 employees, most from the former East Germany, already knew what it meant not to be competitive on the world market. After the end of the German Democratic Republic, the region became a symbol of failed socialist planned economy and environmental degradation. The dirty brown coal plants and dilapidated chemical factories were quickly shut down after reunification and 50,000 people lost their jobs - more than the current populations of Bitterfeld and Wolfen combined.
Solar Valley in Wolfen
Like over 10,000 employees of the Wolfen Film Factory at the time, metalworker Uwe Schmorl found himself unemployed for the first time in 1990. A year later, he had found work with a fiberglass insulation producer, only to lose his job once again at the end of the 1990s when the factory had to close its doors.
Out on a bicycle trip, Schmorl fortuitously discovered a sign announcing the construction of a plant in the field of today's Solar Valley. A few days later he was in Berlin for an interview.
Since then, he has been number eight at Q-Cells - all employees are assigned a number based on when they started. Schmorl was one of the first three employees hired in 2001 by Q-Cells founders Paul Grunow, Holger Feist, Anton Milner and Reiner Lemoine.
Schmorl has grown with the company. He was there when the plants were built, he saw the first multicrystalline solar cells roll off the production line in July 2001, he rose to the position of shift manager and later production manager and was elected Q-Cells' first works council chairman in 2009.
Six weeks after the works council was established, he had to prepare a social compensation plan for the company's first 500 redundancies. The financial crisis that struck in late 2008 put the brakes on the high-flying photovoltaic business; the value of Q-Cells shares slipped from over 80 euros ($105) to under 20.
End of the vision
By then, the "time of the visionaries" was over, remembers Schmorl today. The idea, to develop an inexhaustible energy supply that was environmentally friendly and accepted by enough people to be put into wide use, was successful at first.
Q-Cells went public in 2005, and the high share prices poured money into the coffers of the company, the shareholders and, not least, the solar pioneers. "But their vision was gone by then," recalls Schmorl. One of the founders preferred to go back to being a "small research shop," the other was aiming to become a "global player."
The euphoria of the early years gradually faded in face balance sheets, growth expectations and share price fluctuations. Lemoine died in 2006, and shortly thereafter, Fest and Grunow went back into research. Milner, the last founder still active with the company, resigned as CEO in early 2010.
"In these times, when it's about simply surviving as a company, you need someone else," he told Schmorl at the time. Schmorl himself would have liked to quit along with his former boss - he could not imagine ever working together with someone as good as Milner - but in the end his superior persuaded him to stay.
Saving what can be saved
Since then, Schmorl has struggled with current CEO Cen about the direction of the company. They get along well, but it's different. Schmorl, more of a hands-on type, now sits in his office and tries to keep the operation together. He owes this much to his staff and the region which supported the fledgling Q-Cells in the early days.
At the end of 2010, it looked as if the company was getting back on its feet. But last year, due to a sudden drop in prices and overcapacity in the solar cell sector on the world market, Q-Cells ran a loss of 846 million euros. Sales were down by a quarter, to around 1 billion euros, and at the end of the year shares slid to unprecedented depths. Last-minute efforts to recover failed to convince creditors, and on April 3 the company finally filed for bankruptcy.
"It's like a marriage, in good times and bad: you don't give up," says Schmorl. For the time being, the company is continuing production. Employee wages are secured for the next three months, but after that, who knows what will happen.
Today, there is a worldwide overcapacity of solar cell producers, twice as many as needed. Since the second half of the last decade, the Chinese government has invested billions in solar cell factories. Today, they produce products that are just as good but much cheaper than those produced in Germany.
Nevertheless, nearly all solar cell companies around the world, even those in China, are in the red. In just four months in Germany, the four largest solar companies slipped into bankruptcy, including Solon in Berlin which, like Q-Cells, emerged from the same engineering research collective, Wuseltronik. But Solon, says Schmorl, has found an investor and has managed to continue with almost the same number of employees.
Schmorl can't explain the sudden decline of the solar industry. "You can't blame it all on the Chinese," he says. Some analysts have called it a "market adjustment."
Some in the region feel a sense of deja vu. In a cafe in Bitterfeld, an elderly man says the solar industry just shows that even a market economy can be an incredible waste of resources and manpower.
Author: Jennifer Stange / cmk
Editor: Ben Knight