Solar Won't Revive the Auto Industry Anytime Soon

(MoneyWatch)  It's a heartwarming story: A solar manufacturer needs metal and glass work done. An auto parts manufacturer, preparing to lay off thousands of workers, hears about it and bids on the work. A few months later, the factory is running at full tilt, but instead of CO2-producing automobiles it's pumping out CO2-saving solar equipment.

Solar panels can't be made in this way; they're more akin to computer chips than cars. But as alternate forms of solar power that use expanses of metal and mirrors to catch the rays become popular, more old auto plants and solar companies are getting in on the action.

Skyline Solar is the latest, with a deal for Cosma, a subsidiary of auto parts giant Magna International, to make racks and other metal components for solar arrays at a plant in Michigan.

As the LA Times points out, this isn't the first deal of its kind. Stirling Energy Systems, which makes giant reflective dishes that power Stirling engines with sunlight, is working with Tower Automotive. We wrote about another deal in which two solar companies want to buy an old Ford plant in Michigan. And the LA Times missed Infinia, which also uses Stirlings; like Skyline, it has a deal with Cosma, as well as Autoliv.

These deals are being sold as a way to revive the flaccid auto industry; Skyline says it will "help retool American manufacturing." That's a pretty big claim. Let's see how much ground the automakers have lost recently:


That's about 3.6 million per year less in just six years, roughly a third of all production -- and we're not seeing reductions from previous years. The graph is from a U.S. Department of Commerce report that has plenty of even more depressing statistics, like the decline from 300,000 jobs in vehicle manufacturing in June 2000, to 120,000 workers in January 2009.

Keep in mind, that's not the whole sector; another Commerce report that does cover everything (including suppliers) listed 1,022,200 workers in 2000. The next five years saw that number fall by 173,800 workers. Across the entire auto manufacturing base, the bleeding has been intense for years.

By contrast, there aren't any firm statistics for the solar companies, because they're still getting started. We can use Stirling Energy as an example, though. Stirling says its subsidiary Tessera Solar will start working to place 1,500 megawatts worth of dishes next year. At 25KW per dish, that's about 60,000 dishes and Stirling engines it needs to make over a couple years.

Throw in Infinia, Skyline and an overly optimistic growth scenario, and you may have a hundred thousand units a year. That can't compare that to the pain of an auto industry that is making around 10 million fewer cars per year than it did a decade ago.

All the solar companies involved deserve accolades for their business plans, but as an industry, solar would take decades to replace what the auto manufacturers lost. It's possible, but reports of resurgent manufacturing due to renewables are premature, to say the least.