The Toledo area's solar industry work force was spared Tuesday in a decision by First Solar Inc. to leave its Perrysburg Township plant mostly untouched as the company downsizes its global work force by 30 percent.

First Solar, based in Tempe, Ariz., said that it will close its two plants in eastern Germany and shut down four of 20 manufacturing lines at its operations in Malaysia to trim its worldwide production capacity to about 1.7 gigawatts of solar panels a year.

"The solar market has changed, and so must we," Mark Widmar, First Solar chief financial officer, told Wall Street analysts during a conference call to explain the restructuring.

Later, he said that any work-force reductions in the United States would be "mainly nonmanufacturing roles" and that solar-panel production over the next few years would be handled by its "20 lines in Malaysia and four lines here in the U.S."

The Perrysburg Township plant has four production lines and about 1,200 employes.

Alan Bernheimer, a spokesman for First Solar, confirmed Mr. Widmar's remarks that the manufacturing work force at the Perrysburg Township plant would not be affected by Tuesday's announced changes.

However, Mr. Bernheimer said about 30 employees who are "corporate administrative staff" at the plant would be laid off.

First Solar, which was founded in Toledo as Solar Cells Inc. before it changed its name and moved to Arizona, said it will close its two plants in Germany by October and lay off 1,200 employees there.

The move was predicated by recent changes in Germany and the growing trend among other European countries to eliminate subsidies for the solar-panel industry.

"In recent months, we have seen this trend continue and even intensify as European policy makers have proposed and implemented significant reductions in solar subsidies," Mr. Widmar said.

In Germany, for example, the government has eliminated subsidies for installations larger than 10 megawatts.

Mr. Widmar said that the European market "is not viable without significant subsidies."

From March to December last year, solar-panel prices dropped 50 percent, said Aaron Chew, an analyst with the Maxim Group. "Nobody's making money in this business right now," Mr. Chew said.

Hurt by a tumbling solar-panel market, First Solar's shares have dropped 84 percent from a year ago, falling to the $21-a-share range from about $137.

On Tuesday, First Solar closed at $22.96, up $2.14 (10.3 percent) on the Nasdaq market.

The management of the Nasdaq 100 Index reported Friday that First Solar would be removed from the index because the total value of its shares, or market capitalization, had fallen to less than 0.1 percent of the index's average market cap.

In addition to closing its German facilities, First Solar plans to lay off 550 employees by shutting down the four production lines in Malaysia. And 150 sales and support employees in Europe will be let go.

Mr. Widmar said First Solar regretted cutting its work force but the cuts were necessary "to ensure that the business will be the right size" for the opportunities that the company sees ahead.

First Solar said it expects the cuts will trim its manufacturing costs in a range of $30 million to $60 million this year, and by $100 million to $120 million in 2013.

The shutdowns and layoffs will cost the company between $245 million and $370 million in plant-closing costs, severance, government-loan repayments, and debt retirement, Mr. Widmar said.

The company expects to keep the equipment in Germany and use it elsewhere as opportunities arise, he added.

By shutting down the German plants and focusing production in Malaysia and the United States, First Solar expects to reduce its manufacturing costs in 2012 and 2013.

Mr. Widmar said that this year the per-watt cost of a solar panel should drop to 70 or 72 cents from 74 cents. Next year, the cost should drop to 60 to 64 cents.

First Solar, which uses thin-film technology and cheaper cadmium telluride to make its solar panels, is the lowest-cost producer of thin-film solar panels.

In thin-film production, solar-energy-absorbing coatings are applied directly onto a glass panel.

In contrast, conventional panels use energy-absorbing wafers that are attached to a panel, making them heavier than thin-film modules.

Contact Jon Chavez at: jchavez@theblade.com or 419-724-6128.

First Published April 18, 2012, 4:32 a.m.