SAN JOSE -- SunPower signed a multi-year solar panel manufacturing agreement with Jabil Circuit to build panels in Mexico beginning in the second half of this year. Other terms were not disclosed.

Sun Power is a manufacturer of solar cells, panels and systems. The company called the agreement the "first step" in its long-term strategy to implement regional panel assembly for improved customer service and reduced costs. The company is also continuing to evaluate establishing localized manufacturing facilities in large solar markets in the US.

Separately, Jabil will collaborate with SunPower in the company's participation in the Solar America Initiative (SAI), a U.S. Department of Energy effort to accelerate the development of advanced solar energy technologies. SunPower has participated in the initiative since September 2007. SunPower and Jabil intend to evaluate establishing world-class panel and system manufacturing locations in the US.

"This agreement provides SunPower with the flexibility to site manufacturing near the largest and fastest growing solar markets in North America, improving the efficiency of our supply chain," said Marty Neese, SunPower's chief operating officer. "Jabil's extensive experience in manufacturing and high-quality standards makes them an ideal partner for producing SunPower's solar panels."

Neese is a former vice president, sales operations and program management at Sanmina-SCI, and a former CIRCUITS ASSEMBLY columnist.