By Avi Salzman

Just off a rural road in Michigan near a pumpkin stand, workers for industrial company Corning are assembling a one-of-a-kind solar energy plant. The towering gray warehouse complex is the company's largest American operation, even bigger than the Kentucky factory where it makes glass for iPhones and Apple Watches.

The site is abuzz with activity. Even as the walls and roads are being built outside, workers inside are churning out products. Using intense heat and precision cutting tools, they're turning chunky polysilicon rocks into perfect squares the size of hotel waffles. The finished product is as thin as a human hair.

Those slim squares, known as wafers, are the building blocks of solar panels. America hasn't made them for a decade, even though solar energy accounts for the country's largest share of new electricity generation. Solar is just another industry that the U.S. outsourced to Asia. As of the most recent government data, China controlled 97% of wafer production.

The Michigan plant is a bet that America can take that business back. Already, Corning is churning out thousands of wafers a day, on the way to producing more than one million a day. The new factory is the final link in America's solar supply chain, allowing companies to produce fully domestic solar panels for the first time in at least a decade.

In a tour of the factory this past week, Corning CEO Wendell Weeks told Barron's that solar could become the company's next major business line, driving at least $2.5 billion in annual sales for the company -- more than even Corning's well-established auto-parts division. He expects to grab up to 15% of the U.S. market for wafers. "We think we can be the best in the world at this," Weeks said.

The factory is a gamble for Corning, which has built its business over the past 174 years making specialty glass and ceramics. The Corning, N.Y.--based company has other growth opportunities that look like much safer bets. Corning announced this year that it will make all of the glass for Apple iPhones and watches in the U.S., and build Microsoft's next-generation fiberoptic network. In its latest quarter, sales jumped 58% in the division that includes data-center supplies.

Solar manufacturing, by comparison, is a risky enterprise that has regularly led to financial ruin for other companies. U.S. companies that have tried to go head-to-head with China in solar have repeatedly failed, because Chinese companies benefit from strong state support, lower wages, and a much more advanced renewable manufacturing sector. Just this past June, U.S. subsidiaries of Swiss solar firm Meyer Burger Technology filed for bankruptcy, shuttering an Arizona factory after shelving plans for one in Colorado.

The outlook for solar has only grown worse since then. President Donald Trump and the Republican-controlled Congress eliminated subsidies for solar installations in the big tax bill they passed in the summer. Trump has thrown up additional roadblocks to renewable energy while diverting government money to coal plants, solar's competitors.

Weeks, who is a lanky 6 feet 5 inches tall, acts giddy on the factory floor, chatting with employees just steps away from towering machines churning out products at 1,450 degrees Celsius. He briefly breaks into the song "Popular" from Wicked when asked about the company's recent string of successes with Apple and other customers. But he also knows what he's up against in this new business line.

"When I talk to the folks on the floor, I glow. I mean I'm just over-the-moon happy," he says. "When I walk in and I see all the equipment that's not running yet, my heart goes pitter-patter. Not in a good way."

The Factory

Hemlock is a small town located in the crook of the Michigan mitten, between the thumb and the fingers. Far from cities like Detroit and Grand Rapids, it can seem like it's in the middle of nowhere. But that's not quite true. The region has long been prized by chemical companies for its geologic features. Its brine deposits -- useful in the production of bleach -- drew Dow chemical founder Herbert Henry Dow to the area in the 1890s. He set up the company's headquarters in nearby Midland, where it remains today.

Dow and Corning established a joint venture in 1943 to make silicone and military products in the area. One of the factories the companies built in Hemlock in the 1960s has become the locus of Corning's solar and semiconductor business.

That older facility -- just across the street from the new wafer one -- is known as Hemlock Semiconductor. It makes polysilicon, a high-purity form of silicon used both in solar and in semiconductors. The Dow Corning venture broke up in 2016, and Corning took majority control of Hemlock in a series of transactions in 2020 -- doubling its stake to 80.5% for less than $400 million, or about one-tenth of what the factory would cost to build today. A Japanese company controls the other 19.5%.

The transaction allowed Corning to get into the solar business on the cheap, just as solar demand started to rise during the Biden administration. Once the original factory was churning out raw materials and profits, Corning had the confidence to move up the value chain to make wafers and compete on a better footing with China.

"I don't like fair fights," Weeks says. Hemlock gave the company an "unfair entry point."

Once Corning decided to expand, the company wanted to do it fast -- so fast that it enlisted one of the architects of Operation Warp Speed, the successful effort to speedily get Covid-19 vaccines to Americans. Corning bought an empty soybean field across from Hemlock and was pumping out solar wafers 17 months after the first steel went into the ground. When complete, the site will be the size of 60 football fields, about one-third of it covered with buildings.

Today, production is progressing even as buildings are still going up. Construction workers on lifts are installing ceiling tiles next to rooms where factory workers are handling materials. The company trucks raw polysilicon in the form of silver rocks from Hemlock across the street to the new factory. It loads the raw material into furnaces that melt it. A thin wire hung from about 20 feet above is dipped into the molten goop in the furnace and rotated gradually over the next three days, eventually forming a long polysilicon cylinder known as an ingot. Elsewhere in the plant, workers cut the ingots into ultrathin wafers using diamond wire saws. The process is a mix of manpower and machine. The wafer plant already employs hundreds. Eventually, there will be more than 1,000 people working there.

The Opportunity

Corning disclosed earlier this year that it's spending $1.5 billion on the wafer plant and an expansion of solar capacity at Hemlock. It received tax breaks and a $68 million grant from the state of Michigan, as well as benefits from Trump's big tax bill. Chief Financial Officer Ed Schlesinger says the solar operation should be "cash positive" in 2026, meaning it will be bringing in more money than its capital and operating expenses.

The company's $2.5 billion annual sales target for the division is equal to about 19% of last year's total sales. The number also includes the polysilicon that Corning makes for semiconductors, but Corning says solar accounts for all the growth.

Corning says the solar business has similar profit margins to its other operations, or potentially better. The company is on track to boost its operating margins to 20% by the end of the year, up from 16% in 2023. J.P. Morgan analyst Samik Chatterjee thinks the solar margins could stretch as high as the mid-20s.

Analysts who cover Corning tend to focus on the company's more high-profile businesses, like the Apple contract or its business making glass for TV screens. But some financial pros are starting to take a closer look at solar as a growth driver. "If they keep to their targets, it definitely has big financial implications," says Chatterjee, who has an Overweight rating on the stock and a $100 price target. Corning shares have risen 86% this year as its tech opportunities have expanded. They were recently trading at $87.

A Global Battle

There is real demand for what Corning is making at its new plant, even if Trump has put roadblocks in the way of solar adoption. U.S. utilities are on track to add 33 gigawatts of solar this year, the largest source of new electricity generation. That's roughly enough to power 10 million households. Trump's policies are almost certain to curb solar's growth rates, analysts say. But they won't destroy the industry -- solar power is still the fastest way to bring new power to the grid, and among the cheapest.

Trump's tax bill removed incentives for installing solar starting next year, although some grandfathered projects are likely to keep receiving incentives for years. The tax bill, however, kept substantial incentives for domestic manufacturing, which Corning expects to receive. Those new rules also make Corning's raw materials more attractive to U.S. companies that are making finished products such as solar panels. The U.S. now has enough solar panel makers to supply just about all of the country's domestic demand. To receive credits, those factories will need to use materials that were made in the U.S.A.

In addition, Trump and President Joe Biden both imposed high tariffs on Chinese-made solar products. Taking into account all the government policies and other factors, Corning is on track to be the lowest-cost producer of wafers in the world, Weeks says.

Weeks doesn't expect the solar market to collapse. But even if it plateaus, Corning can still succeed by taking market share from overseas producers. The tax bill makes it much more favorable to use domestic products. "You can cut the market by a factor of five," he says. "As long as you want it to be domestically made, we'd be fine."

(MORE TO FOLLOW) Dow Jones Newswires

November 07, 2025 04:00 ET (09:00 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.