FRANKFURT Bosch ROBG.UL said it will sell or shut down its heavily loss-making solar energy operations, the latest blow to the industry as Germany curbs green energy subsidies and cheap Chinese imports flood the market.
In a rare reversal of strategy from the manufacturing conglomerate, Bosch said on Friday it would end its photovoltaics, or solar panel production early next year and put parts of the business up for sale.
Unlisted Bosch, one of the world's largest maker of car parts, has lost 2.4 billion euros (2 billion pounds) since it created the solar energy unit in 2008 after it bought Aleo Solar and Ersol. It made a 1 billion euro loss last year.
"This is possibly the most painful experience that I have had to endure in my professional career," said Chairman Franz Fehrenbach in a statement unveiling the plans for the unit that employs 3,000 staff.
The Bosch unit is the latest casualty of boom and bust experienced in Germany's solar energy industry. Former heavyweights SolarWorld SWVG.D and Conergy CGYGk.DE are in debt restructuring talks while Q-Cells QCEG.UL filed for insolvency last year.
Bosch said in January it was considering all options for its solar unit, having written off the assets entirely last year.
Germany, for years a leading proponent of renewable energy, had spurred a surge in solar panel installations by handing out hefty subsidies funded by electricity surcharges to encourage consumers to shift away from nuclear and fossil fuel.
But the German government reined in those subsidies in an attempt to bring down overcapacity in the industry. Germany wants to reduce the expansion of solar power after a record 7,500 megawatts in capacity was added in 2011 to bring its total to 25,000 megawatts, nearly as much as the rest of the world combined.
To make matters worse, Chinese rivals have flooded global markets with cheap solar panels, prompting the European Commission to launch a dumping investigation.
(Reporting by Ludwig Burger and Hendrik Sackmann in Stuttgart; Editing by Clelia Oziel)