Work-hour reduction and layoffs are becoming a norm in the renewable energy industry.

Q-Cells has cut working hours for about 2,000 employees, or 80 percent of its staff, according to German media reports (picked up by Deutsche Bank's equity research division). Thesolarcell maker cited falling demand as the cause for the move, which came less than a week after Oerlikon Solar said it, too, had reduced work hours for about 200 employees (see Green Light post). UPDATE: A Q-Cells spokesman said the company has roughly 2,500 employees.

Q-Cells, like many other solar manufacturers, have had to lower its sales expectations and scale back factory operations over the last six months. Q-Cells noted in its 2008 annual report, posted last month, that the first half of 2009 would be extra tough for the solar industry, given the economic crisis and the arrival of the winter in which fewer installations typically take place.

"Due to a short term mismatch between global supply of photovoltaic systems and a weaker short term demand due to the aforementioned uncertainties in project financing and the general economic situation, inventory has been built up and prices have been falling over the last months," according to the annual report.

Inventory build up and the falling prices of solar energy equipment have caused several companies to take multimillion-dollar write downs (see LDK Solar Faces Tough Road Ahead, Says Analyst). Financial analysts also voiced concerns about SunPower's inventory build up when the company discussed its first-quarter earnings last week. SunPower's CEO Tom Werner said he expects the inventory to decrease quickly in the second quarter.

Warmer, spring weather should help to perk up demand, but not by much, wrote Alexander Karnick, an equity research analyst with Duetsche Bank, in a research note.

"We suspect there could be a slight [mainly weather related] sequential improvement of shipment levels in Q2. However, we assume that Q2 shipments in terms of [year-over-year] development will still be strongly below last year's levels for the entire industry," write Karnick. "Sharply fallen prices, inventory built in Q4, Q1 [market participants speculating about 1GWp inventory across the globe] and under-utilized plants [i.e., short-term work] will likely suppress profits in Q2 as well."

While solar companies are seeing a sharp drop in sales, wind turbine maker Vestas Wind Systems in Denmark actually saw a 70 percent jump in first-quarter net income. The company on Tuesday posted €56 million in net income on €1.1 billion in sales for the first quarter.

Still, Vestas is cutting jobs – 1,900 of them. The layoffs will take place in Europe, mostly in Denmark and the United Kingdom. The company said it's cutting its European operations because it wants to devote resources to its efforts in the United States and China, the two growth markets.

The company is eager to gain a strong foothold in China, which is keen on promoting renewable energy generation. Last week, Vestas said it had sold 58 wind turbines to Datang Huolinhe Renewable Power Co. to build a wind farm in Inner Mongolia. Earlier this month, Vestas announced it had designed a wind turbine specifically for the Chinese market. The company noted that over 90 percent of the components for the new turbine would be made in China.

ATS Automation Tooling Systems in Canada said Tuesday it's shutting down Photowatt France, its silicon wafer, cell and panel subsidiary for three weeks. Canada-based ATS (TSX: ATA), which designs and makes factory equipment for telecom, semiconductor, computer and solar equipment makers, said the temporary measure will affect 450 employees at Photowatt's factory in Bourgoin-Jallieu.

Last month, ATS said it was laying off 80 full-time employees at its headquarters in Cambridge, Ontario, and 160 temporary employees at Photowatt as a result of slow demand for its products and services.