TOYO Co., Ltd Announces Plans for Additional 2GW Solar Cell Capacity Expansion in Ethiopia

Rhea-AI Summary

TOYO (Nasdaq: TOYO) has announced plans to double its solar cell production capacity in Ethiopia with an additional 2 gigawatts (GW) expansion. This decision follows the successful completion of Phase 1 facility, which also has 2GW capacity and is scheduled to begin production in early Q2 2025.

The Phase 2 expansion key details include:

• Investment of $47 million
• Construction to begin in April 2025
• Completion expected by July 2025
• Production start planned for August 2025
• 28,000 m2 facility in Hawassa, Ethiopia

The company is currently in negotiations for the Phase 2 facility lease, which will be adjacent to Phase 1's automated cell production site. The existing infrastructure from Phase 1 will support the expansion, enabling a faster timeline.

Positive

• Doubling production capacity from 2GW to 4GW indicates strong market demand
• Phase 1 facility completion demonstrates execution capability
• Existing infrastructure reduces expansion timeline and costs
• Strategic location adjacent to Phase 1 facility enables operational efficiency

Negative

• $47 million capital expenditure requirement
• Lease agreement for Phase 2 facility still under negotiation
• Execution risk of meeting aggressive 4-month construction timeline

Insights

Solar Industry Expert

TOYO's doubling of solar cell capacity in Ethiopia from 2GW to 4GW represents a significant strategic expansion in the rapidly growing solar manufacturing space. The timing is particularly notable as they're committing to Phase 2 before Phase 1 is even operational, indicating strong confidence in market demand for their products.

The $47 million investment for 2GW additional capacity translates to a cost-efficient $0.0235 per watt of manufacturing capacity, which is competitive by industry standards. Choosing Ethiopia for expansion offers several strategic advantages, including lower labor costs and potentially preferential access to African and European markets.

The accelerated timeline (completion in just 4 months) is ambitious but feasible given they're leveraging existing infrastructure and building adjacent to their first facility. This integrated manufacturing approach should create operational efficiencies and reduced logistics costs.

This expansion positions TOYO to potentially capture greater market share in a period of growing global solar installations. The commitment to double capacity before proving the initial phase demonstrates management's bullish outlook on solar demand and their confidence in their manufacturing capabilities.

Financial Analyst

TOYO's $47 million investment in doubling its Ethiopian solar cell capacity represents a substantial capital commitment relative to its $142.6 million market capitalization—approximately 33% of its current market value. This scale of investment indicates significant management confidence in future demand and potential returns.

The expansion timeline is aggressive but strategically sound. By utilizing adjacent space and existing infrastructure from Phase 1, TOYO should achieve cost efficiencies and faster time-to-market. The article doesn't specify financing methods (cash reserves, debt, or equity), which will be an important factor in assessing the full financial impact.

This capacity expansion comes at a pivotal moment, with the company's stock trading at $3.02 per share. The market will likely view this expansion positively as it signals growth potential, though near-term financial results may be impacted by upfront costs before the new capacity generates revenue.

While the investment demonstrates TOYO's commitment to growth, investors should monitor execution risks, particularly since Phase 1 isn't yet operational. Successful implementation could position TOYO as a more significant player in the global solar supply chain, potentially leading to improved economies of scale and enhanced competitiveness.

TOKYO, March 26, 2025 /PRNewswire/ -- TOYO Co., Ltd (Nasdaq: TOYO) (OTC: TOYWF) ("TOYO" or the "Company"), a solar solution company, is excited to announce it will begin building an additional 2 gigawatts (GW) expansion of its solar cell capacity at its new Ethiopia facility. This expands upon the successful completion of Phase 1 of the facility and is a direct response to the global demand for its solar cell products.

"This expansion is a direct response to the strong demand we're seeing globally for high-performance solar cells. We have successfully completed the construction of the Phase 1 solar cell manufacturing facility, which has a capacity of 2GW. We are currently conducting equipment installation, tests, and trial runs at this facility. With formal production scheduled to commence in the early second quarter of 2025, we are confident in our ability to scale up production quickly and efficiently," said Mr. Junsei Ryu, Chairman and CEO of the Company. "The global interest and orders we've received for our solar cell products, even before Phase 1 is fully operational, confirm the strength of our strategic vision. Given the global demand, we have decided to proceed with this additional capacity."

Key Highlights of the Expansion Plan:

• Increased Capacity: This expansion will double the Company's current Ethiopia cell production capacity from 2GW to 4GW.
• Expansion timeline: The expansion is scheduled to begin in April 2025 and expected to be completed in July 2025, with production expected to commence in August 2025.
• Strategic Investment: The project is estimated to require an investment of $47 million.

TOYO is in negotiation to sign a lease for a 28,000 m² facility in Hawassa, Ethiopia, adjacent to the Company's Phase 1 automated cell production site, for the Phase 2 expansion. The existing infrastructure for the Phase 1 site can support the Phase 2 expansion, significantly shortening the expansion timeline.

"TOYO is committed to providing cutting-edge solar solutions to meet the global market's needs while reducing our carbon footprint across the supply chain. This expansion reinforces our aspiration to be a key player in the global solar industry and our dedication to a sustainable energy future," said Mr. Ryu.

About TOYO Co., Ltd.

TOYO is a solar solutions company that is committed to becoming a full-service solar solutions provider in the global market, integrating the upstream production of wafers and silicon, midstream production of solar cells, downstream production of photovoltaic modules, and potentially other stages of the solar power supply chain. TOYO is well-positioned to produce high-quality solar cells at a competitive scale and cost.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "expect," "anticipate," "believe," "seek," "target" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include but are not limited to, statements regarding the expected growth of TOYO, the expected order delivery of TOYO products, TOYO's construction plan for new facilities and anticipated commencement of production. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of TOYO's management and are not predictions of actual performance.

These statements involve risks, uncertainties, and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by these forward-looking statements. Although TOYO believes that it has a reasonable basis for each forward-looking statement contained in this press release, TOYO caution you that these statements are based on a combination of facts and factors currently known and projections of the future, which are inherently uncertain. In addition, there are risks and uncertainties described in the documents filed by TOYO from time to time with the SEC. These filings may identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements.

TOYO cannot assure you that the forward-looking statements in this press release will prove to be accurate. These forward-looking statements are subject to several risks and uncertainties, including, among others, the outcome of any potential litigation, government or regulatory proceedings, the sales performance of TOYO, and other risks and uncertainties, including but not limited to those included under the heading "Risk Factors" of the filings of TOYO with the SEC. There may be additional risks that TOYO does not presently know or that TOYO currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In light of the significant uncertainties in these forward-looking statements, nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. The forward-looking statements in this press release represent the views of TOYO as of the date of this press release. Subsequent events and developments may cause those views to change. However, while TOYO may update these forward-looking statements in the future, there is no current intention to do so except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing the views of TOYO as of any date subsequent to the date of this press release. Except as may be required by law, TOYO does not undertake any duty to update these forward-looking statements.

Contact Information:

For TOYO Co., Ltd.
IR@toyo-solar.com 

Crocker Coulson
Email: crocker.coulson@aummedia.org
Tel: (646) 652-7185

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SOURCE TOYO Co., Ltd

FAQ

What is the total production capacity of TOYO's Ethiopia facility after the expansion?

After Phase 2 expansion, TOYO's total production capacity in Ethiopia will be 4GW, doubled from the initial 2GW capacity of Phase 1.

How much is TOYO investing in the Phase 2 Ethiopia expansion?

TOYO is investing $47 million in the Phase 2 expansion project.

When will TOYO's Phase 2 Ethiopia facility begin production?

Production at the Phase 2 facility is expected to commence in August 2025.

What is the timeline for TOYO's Phase 2 expansion project in Ethiopia?

Construction will begin in April 2025, with completion expected in July 2025 and production starting in August 2025.

Where is TOYO's new solar cell facility located in Ethiopia?

The new facility will be located in Hawassa, Ethiopia, adjacent to TOYO's Phase 1 production site.