McClellan Business Park scored a key tenant on Thursday when a major Chinese solar company announced plans to set up a manufacturing facility at the former Air Force base.
China Sunergy Co. will start assembling solar panels at a 140,000-square-foot plant that once produced draperies for J.C. Penney Co. The fully automated factory is expected to open in September, after the company retrofits the building with new equipment from China. The plant will eventually employ 200 local workers, including engineers and service technicians.
In an interview, Sally Zhou, president of the U.S. subsidiary, said opening a factory in Sacramento County makes sense because California is the largest market for solar panels in the United States.
“We want to be where the customers are,” Zhou said in Mandarin, following a news conference held by the Greater Sacramento Economic Council at the business park.
The council has played an increasingly important role in attracting business and investment to the region. The location at McClellan will be Sunergy’s first manufacturing outpost in the United States. Based in Nanjing, which is about 200 miles east of Shanghai, Sunergy has more than a dozen plants in China, two in Vietnam, one in South Korea and one in Turkey.
Sunergy already had a sales and marketing office in San Jose, but company officials began looking last summer for a new city in which to base their U.S. manufacturing operations. After exploring options on the East Coast and in the Midwest, they settled on McClellan due to its proximity to China, Zhou said.
Simon Szeto, an outside consultant acting as a Sunergy spokesman, said the company was sold on three things: cheap electricity provided by the Sacramento Municipal Utility District; railway access to ship products; and the robust support of local organizations, including the business park and the Greater Sacramento Economic Council. Sunergy’s investment is valued at $10 million, Szeto said.
The move to manufacture in the United States by a Chinese company is unique, given the high labor costs of American workers relative to their Chinese counterparts. Creating new manufacturing jobs has been a major priority for President Donald Trump, who has criticized American companies for shipping jobs overseas.
Zhou said efficiencies from new production equipment will offset the cost of increased wages.
“The policies of (Trump) will be favorable for us,” Zhou said, suggesting that Sunergy could expand its footprint if things go well at McClellan.
Local and state governments did not provide any tax incentives or public money to fund the relocation. However, Zhou said she is in talks seeking certain financial incentives.
Asked why Sunergy opted to invest in the U.S., Szeto said products that are “Made in the USA” have cachet among American consumers.
“Customers are more likely to trust the quality. We will also be able to charge more,” he said.