SolarCity Corp (NASDAQ:SCTY) shares surged 5% to $71.12 after the company announced that it would expand its business in seven states by the end of this year. The San Mateo-based residential solar installer will open 20 new operation centers in Arizona, California, New York, Delaware, Maryland, Nevada and Massachusetts.
SolarCity’s new expansion plan to create 600 jobs
The Elon Musk-backed company currently has operations in 15 states. SolarCity said its latest expansion phase would generate more than 600 new jobs. New operation centers will reduce costs by decreasing service and installation drive times. The company witnessed a whopping 60% QoQ growth in bookings during the second quarter. The number of new customers more than tripled in April-June quarter from the previous year.
In June, SolarCity bought Silevo for $200 million to foray into manufacturing of high-efficiency panels. SolarCity chairman Elon Musk said the Silevo acquisition will help the company produce low-cost, high-efficiency panels in volumes large enough to support SolarCity’s rapidly growing installation business. SolarCity plans to build a 1GW manufacturing plant in New York.
Deutsche Bank said in a research note last month that the New York manufacturing plant will require a maximum of $750-800 million in investments. SolarCity has said the plant will become operational by the end of 2016. The company is currently it talks with New York state officials to figure out how much incentive it could receive to build the plant.
SolarCity witnessing a broad-based growth
Deutsche Bank said the rooftop solar installer will spend “a few hundred millions in capex” after government incentives. The company is expected to come up with a secondary offering by the year-end. Deutsche Bank analysts expect the company’s near-term bookings to remain robust this year, and accelerate in 2015. SolarCity is witnessing a broad-based growth from many new markets. Hawaii and non-California states now account for a bigger percentage of its total installations.
In the last six months, SolarCity opened its first operation centers in Nevada and Delaware. The company also opened a third location in Maryland, and another two locations in Massachusetts.