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Running Head: THE SOLYNDRA FIASCO 1
The Solyndra Fiasco
Dr. Christian Gronet founded Solyndra in 2005 in Fremont, California. The energy company manufactured cylindrical panels of copper indium gallium selenide (CIGS) thin-film solar cells as well as a variety of other solar products. There was much support for this new company as it was supposed to jump-start America's energy conservation plan. The company even had the backing of President Barack Obama and Vice President Joseph Biden. The government also provided some major support to the company and gave it $535 million in loan guarantees in 2009.
However, the company could not thrive in a commoditized economy, nor could it keep pace with Chinese technology. Another reason this company failed is because the price of silicon dropped approximately 90%, which in turn eliminated the price advantage associated with CIGS. Finally, the last reason the company failed is because natural gas (the cleanest fossil fuel) prices were falling.
All of these factors contributed to the company filing Chapter 11 bankruptcy in September 2011. The company also lacked marketing and focused too much on its growth.
The company and government, specifically President Obama and the U.S. Department of Energy, came under much scrutiny because there were many warning signs surrounding Solyndra and its inability to turn a profit, as well as its financial instability. "In March 2010, PricewaterhouseCoopers LLP determined that Solyndra was suffering from severe financial difficulties, raising "substantial doubt" as to "its ability to continue as a going concern" (Emord, n.d., p. 17). Despite all the signs, the government still gave the company more than a half billion dollars. After the company received the loan, the DOE failed to monitor its investment. There was a prediction from a DOE staff member that said the...