Skyline taps auto supplier for solar racks

Mountain View, Calif.-based Skyline Solar said today it's using dormant automotive manufacturing capacity to make reflective racks for its concentrating photovoltaic solar projects.

Skyline signed a commercial manufacturing agreement with automotive-parts supplier Cosma International, a unit of Aurora, Ontario-based auto supplier Magna International (NYSE:MGA). Financial terms and length of the agreement were not disclosed.

Mass production of the structural and reflective racking components is expected to reduce costs, Skyline CEO Bob McDonald told the Cleantech Group. In addition, the pre-assembly of the components could cut down on installation time, also saving money, he said.

"Solar energy is under pressure to become lower cost," he said. "The automotive sector has a century of figuring out how to get costs out of large metal assemblies."

The deal is Skyline's first commercial manufacturing agreement, and is expected to help the company begin shipping products this quarter.

Skyline developed concentrating photovoltaic solar systems with W-shaped reflective racks. The racking systems have a structural function of keeping the system in place, as well as an optical condensing function to focus the sun on a small area. Skyline says it uses 10 percent of the silicon as traditional flat-panel systems.

Skyline designed the systems to be mass produced. The company considered using appliance manufacturers but found that auto suppliers were a "natural fit," McDonald said.

"There's a very light touch on retooling to enable it to produce our solar equipment instead of a family sedan," McDonald said.

McDonald said Cosma delivered the first structural and reflective racking components a few weeks ago from a factory in Troy, Mich. That facility is expected to continue to produce the components for a couple quarters, but Skyline plans to switch to a larger facility in 2010.

Tour the plant »

Skyline plans to finalize the location for full-scale production this quarter, with shipments expected in the second quarter of 2010. Tim Keating, vice president of marketing for Skyline, said the companies did not want to reveal the production rate.

McDonald said Skyline is choosing among Cosma's auto plants in Alabama, Iowa, Kentucky, Maryland, Ohio, South Carolina and Tennessee. Cosma has 37 manufacturing facilities, while Magna has 247 across the globe. Last year, Cosma's parent company announced plans to target the electric vehicle market (see Magna buys BluWav Systems).

"Auto companies are looking to diversify to markets beyond automobiles," McDonald said. "We're leveraging the immense capabilities and capacity of the auto industry to get the cost out of our equipment."

Cosma—which produces automobile chassis, frames and bodies—has a global footprint, which McDonald said was an important factor in creating the partnership.

McDonald declined to say whether the deal with Cosma was exclusive, but he referred to it as "a partnership between two companies that goes beyond the contract level."

In May, Skyline came out of stealth to reveal it raised $24.6 million in its first funding round in late 2008 (see IPOs back on the table?). New Enterprise Associates led the round. Skyline also raised $3 million in funding from the DOE in September (see U.S. DOE puts up $17.6M for solar PV).

Skyline has 60 employees.