UPDATE 2-SunPower to consolidate Philippines facilities

(Adds details on consolidation of manufacturing facilities)

* Says cost reduction initiatives remain on track

* To record pretax restructuring charges of $51 mln-$69 mln

April 16 (Reuters) - Solar panel maker SunPower Corp said it will consolidate its Philippine manufacturing operations to cut capital expenditure and cost per watt.

Solar companies suffered through most of 2011 as prices for the panels that turn sunlight into electricity fell by nearly 50 percent, squeezing margins and driving some smaller players into bankruptcy.

The companies have sought to reduce production costs to improve profits and make the renewable power source less reliant on government subsidies.

San Jose, California-based SunPower, which is majority owned by French oil company Total SA, said it will consolidate its Philippine manufacturing operations into its 330-megawatt Fab 2 facility.

Through the measures, SunPower expects to achieve its cost goal of about $0.86 per watt.

The company expects to record pre-tax restructuring charges of $51 million to $69 million for the closure of Fab 1. SunPower said $47 million to $63 million will likely be recorded in the second quarter.

The company said it will transfer equipment and employees from Fab 1 to Fab 2, adding that employees will have the opportunity to work for potential Fab 1 tenants.

SunPower is working with Deca Technologies and others on the use of the Fab 1 facility. The company is a minority shareholder in Deca Technologies.

SunPower shares, which have lost about 64 percent of their value in the last year, closed at $5.73 on Friday on the Nasdaq. (Reporting by Swetha Gopinath and Sakthi Prasad; Editing by Helen Massy-Beresford, Maju Samuel)