Wacker Weighs Closing Tennessee Polysilicon Plant After Trump Tariffs, Reuters Reports
A German chemicals company, Wacker Chemie, is contemplating shutting down its American plant in Charleston, Tennessee, which employs approximately 600 people, according to a Reuters exclusive. This comes in the wake of the US government’s new polysilicon tariffs.
Polysilicon, a raw material for both solar panels and semiconductors, is produced by only two companies in the United States: Wacker and Hemlock Semiconductor. While the White House’s proclamation of August 6 aimed to reverse the decline in domestic production, the measures have backfired.
The tariff, set at 15% on most imported polysilicon and derivatives, along with price floors of $21 per kilogram for polysilicon and $100 for ingots and wafers, takes effect in December. However, the policy applies to all products regardless of where the polysilicon used was produced, benefitting no US producers while increasing costs for customers.
Wacker has openly stated that the proclamation "does not, as it reads now, effectively support the use of US-made polysilicon." The high cost of American polysilicon, roughly four times that of Chinese material, makes the tariff ineffective in closing the gap.
This risk was previously highlighted by Christian Hartel, Wacker’s CEO, who warned that without effective trade action, the company could face having "one plant too many."
The national security argument for the policy centered on the use of polysilicon in defense systems. However, the new measures ultimately hurt Wacker’s customers, who bear the brunt of the price increase.
The Tennessee plant, while European-owned, is an example of the company investing in America, which aligns with the administration’s stated goals. Yet, Wacker is now considering an exit, leaving only one American producer of polysilicon.
Chinese producers, in the meantime, are advancing up the value chain, dominating solar-grade polysilicon and expanding into semiconductor-grade material, which has defense applications. Europe, too, is preparing for the clean tech race while stockpiling billions of dollars’ worth of Chinese solar panels.