Jul 26, 2024 08:18 PM
BUSINESS
China’s Solar Sector Must Consolidate Amid Mounting Losses, Industry Group Warns
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Workers inspect solar power modules on a factory roof on July 4 in Jinhua, East China’s Zhejiang province. Photo: VCG
Many Chinese solar manufacturers slowed or halted production altogether in the first half of this year, as they struggled to survive amid overcapacity and an ensuing price war, prompting an industry group to call for faster consolidation among the firms.
“It’s rare for the whole industry to lose money,” Wang Bohua, honorary chairman of the China Photovoltaic Industry Association (CPIA), said at a solar conference in the eastern province of Zhejiang on Thursday.
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- Chinese solar manufacturers have faced overcapacity and price wars, leading many to slow or halt production, with the industry's overall financial performance deteriorating in the first half of 2024.
- Photovoltaic module prices dropped from nearly 2 yuan per watt in early 2023 to about 0.8 yuan in July 2024, forcing companies to sell below cost.
- The CPIA called for faster industry consolidation and warned of risks including order delivery delays and quality issues, while newly installed capacity grew by 30.7% year-on-year.
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Who’s Who
- Longi Green Energy Technology Co. Ltd.
- Longi Green Energy Technology Co. Ltd. (601012.SH) suspended production at its battery factory in Vietnam in June and announced plans to cut thousands of jobs in March, in response to the overcapacity and price war affecting the Chinese solar industry.
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What Happened When
- Early January 2023：
- The opening bid price for photovoltaic modules was nearly 2 yuan per watt.
- March 2024：
- Longi Green Energy Technology Co. Ltd. planned to cut thousands of jobs.
- First half of 2024：
- Many Chinese solar manufacturers slowed or halted production, with the number of projects commissioned, started and planned down more than 75% year-on-year.
- Second quarter of 2024：
- The financial losses for most companies in the main industrial chain worsened compared with the first quarter.
- June 2024：
- Longi Green Energy Technology Co. Ltd. suspended production at its battery factory in Vietnam.
- By July 2024：
- The price of photovoltaic modules fell to about 0.8 yuan per watt.
- Thursday, July 25, 2024：
- Wang Bohua discussed the industry's financial issues and overcapacity at a solar conference in Zhejiang.
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