"Losses for China’s largest solar manufacturers, including Suntech Power Holdings Co. and JA Solar Holdings Co. may continue through next year as declining shipments prompt them to slash prices and liquidate inventory.
Shipments at Suntech will fall about 20 percent in the fourth quarter from the third, the world’s largest panel maker said today in its third-quarter earnings report. JA Solar, the country’s biggest cell producer, also said shipments will fall sequentially, and it wrote off inventory in response to falling prices, driving down gross margins.
Cell prices have fallen 59 percent since Dec. 27, according to Bloomberg New Energy Finance. Seven Chinese companies reported lower gross margins since yesterday and three said margins have moved into negative territory, an unsustainable level, said Hari Chandra Polavarapu, an analyst at Auriga USA in New York.
“Liquidation is leading to suicidal pricing.” Polavarapu said in an interview today. There are too many solar companies in China, he said, and they are cutting prices to maintain share. “China’s strongest manufacturers are sacrificing profitability because the weakest players still exist.”
Chinese solar manufacturers expanded capacity faster this year while demand growth slowed in Europe, the top regional market."...
via Tom Nelson
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