Four Development Trends of International PV Industry Changes

Big trend 1: The distribution of PV industry tends to be dispersed rather than tend to monopolize. In the large-scale fluctuations in this photovoltaic industry, photovoltaic power generation subsidies are policy factors, and solar cell prices caused by economic crisis, technological progress and capacity expansion Decline is a market factor. The combination of these two factors makes the solar power generation industry different from other industries that are completely controlled by the laws of the market economy, as well as some industries that are completely controlled by policies (such as coal). The business model of companies growing in this special environment is also very special, and it is constantly undergoing tremendous changes.

Let us first look at the overall changes in the world's photovoltaic companies in recent years.

We compared the world's top ten PV manufacturers' share of the world market from 2005 to 2010. From this one can surprisingly find two big changes:

First, the world’s top ten PV companies accounted for a very large change in market share. In 2005, the world's top ten PV companies accounted for 72.8% of the market share, while in 2010 it accounted for only 39.8%.

Second, the difference in the respective market share of the top ten photovoltaic companies is also shrinking. In 2005, Sharp, Japan's largest photovoltaic company, accounted for 24% of the world's production, and the last Solar Word accounted for only 2%. The difference between the two is 12 times. In 2010, the market share of the world's largest company, First Solar, was 5.8%, and the last market share of Gintech in Taiwan was 2.4%, which was a difference of 2.4 times. We describe the changes in the market share of the world's top ten PV companies from 2005 to 2010.

It can be seen from the above that the market share of the top ten photovoltaic companies is decreasing year by year, but it is gradually slowing down in the past three years. This phenomenon shows that as the entire PV industry gradually expands in scale, competition becomes more complete and monopoly continues to weaken. From another perspective, this phenomenon indicates that the difficulty of a single photovoltaic company becomes very large after its scale has been extended to a certain extent. Therefore, it is difficult for these companies to further expand their scale after reaching a production capacity level. The disparity in the size of each enterprise is getting smaller and smaller, and the proportion in the total scale has gradually shrunk.

So why did this happen? We believe that its disease originated from the volatility of the photovoltaic market.

The scale of solar cell manufacturers is constantly expanding, with annual sales exceeding 10 billion yuan. The amount of liquidity needed for such large production is very large, but such a large amount of sales is a single product, and the final shipment is all sun. Battery modules are also relatively single-unit market, so such large sales are controlled by the laws of the single market. Once the European PV market fluctuates, the company will be in a standstill as a whole, and once the inventory is increased due to poor market, funds cannot be recovered. Enterprises will have a hard time coping with. And the bigger the company is, the harder it is to support it.

In 2010, Wuxi Suntech produced the world's second largest PV output at 1585 MW. According to 2010, the average selling price was about 15 yuan per watt. The annual output was about 23.8 billion yuan, which required a monthly output of 1.98 billion yuan. If there are sudden changes in the market and poor sales, such as the sudden change in the European market, causing the backlog of Chinese products, then it is difficult for companies to support such a huge capital demand. Even if they can get from banks, their financial costs will be high. It's amazing.

It is reported that JAA will expand its production capacity to 3GW in 2011. We believe its risk is quite large. If calculated at 12 yuan per watt, the annual output will be 36 billion yuan, and the average monthly output value will reach 3 billion yuan. If there is a problem with the market or silicon supply, the financial status of the company will be rapid. deterioration.

Throughout the market since 2004, the photovoltaic industry has always been developing in various fluctuations. At the beginning of the market, the market was very good, but the supply of silicon materials was not good, enterprises had to pay advance payments; then there was an economic crisis and the market had problems. The economic crisis and policy changes have made the fluctuation of the industry the norm. This situation makes it difficult for companies to do very much.

According to the general economic laws, people always think that the larger the scale of the enterprise, the greater the ability to resist risks. However, the special nature of solar cell manufacturing industry currently determines that such a rule may not necessarily apply. The large downward fluctuations in the photovoltaic market that took place in Europe this time, many people think that there will be industry reshuffle, many small businesses will close down, and large companies are the ultimate winners. The author believes that the collapse of many small businesses will become a reality, but the losses of big companies will be even more severe. Although large companies will not fail, the industrial structure we see after the crisis will be the further dispersion of concentration and industry competition. Will be more full.

Major trend Second, the impact of fluctuations in the photovoltaic industry on the business model of Chinese companies This situation has caused the entire Chinese PV companies to think about their own business models. The rise of the business model of expanding production scale in 2010 will be tested.

In the second stage of China's photovoltaic industry from 2004 to 2008, it experienced the first high-speed development period of China's photovoltaic industry. In this period of rapid development, there have been myths such as Wuxi Suntech and Jiangxi LDK. The main model for operating companies at that time was to make huge profits by using the huge gap between the long single price and the spot price formed by the shortage of silicon materials. However, this long-term use of silicon requires a large amount of funds, so many companies use the stock market to use the funds to sign long-term silicon materials, and then use the price advantage of long-term silicon materials to make high profits, and then expand. Reproduction enables the rapid development of the company. This model seems to have become a basic model for the rapid expansion of many companies at that time. However, the economic crisis that broke out at the end of 2008 caused speculators of these disillusioned silicon materials to fall into trouble. The price of long-term orders signed was even higher than the spot price, and the receipt of silicon material according to orders had become an inventory backlog. The so-called "what is Xiao Cheng and Xiao He?" Many large PV manufacturers have suffered huge losses. In this way, the history of the speculation of silicon materials was completely ended during the economic crisis. From supporting silicon to king to cash, it is king and the market is king.

In the subsequent period of the second wave of high-speed expansion in 2010, faced with huge market demand, people found that solar cell capacity was not enough and how much the product was produced. Therefore, a large amount of money enters the photovoltaic industry. Investment is very enthusiastic. But even with the rapid expansion of market and downstream production capacity, silicon materials cannot reproduce several times higher spot market prices. At this stage, people seem to have formed another industrial model, which is to expand the scale of the photovoltaic cell production line enormously, and hundreds of megawatts of people on the battery line. Several major battery factories have announced that they will expand to 2 to 4 GW in 2011. The huge capital required for the expansion of the photovoltaic industry is also obtained from the stock market, banks, etc. Due to the rapid expansion of these companies, a huge scale has been formed. However, at this stage, there is no huge profit space created by the "double price system of silicon materials." The company's profits are more from the finesse of the internal management of the company, as well as the grasp of the market and the rhythm of the silicon material. At this stage, many companies have successfully listed in the country, so as to quickly make a fortune. However, the downward fluctuations in the European photovoltaic market have also had a huge impact on the operating models of these companies. The larger the scale, the more serious the product backlog and the tighter the capital chain. If the crisis lasts a long time, the possibility that these large companies will stretch their capital chain too tightly enough to break will be greatly increased.

Megatrend III: Industrial Transfer to Developing Asia According to Photon International's 2011 third period of statistics, by 2011, China accounted for 47.8%, accounting for 13018.4MW; Taiwan accounted for 12.7%, totaling 3448.5MW; the two places combined: 60.5%, It counts 16466.9MW, and in 2010, the total is 50.2%. Looking at the entire Asian region, Japan accounted for 8.5%, 2299.5MW; Malaysia, 5.2%, 1406.5MW; South Korea, 3.2%, 865MW; Asia, the remaining 4.9%, 1341.8MW. Total Asia accounts for 82.3% of global production, which is 22379.7MW, compared with 75.7% in 2009.

If we compare the data of previous years, it is more obvious that the entire manufacturing center of the photovoltaic industry is clearly shifting to the Asian region, especially to the mainland of China and Taiwan.

The reasons, in addition to traditional arguments, include: low labor costs and low resource costs. We also see two factors: Chinese companies are significantly faster than Western countries in decision-making and action, and a solar cell production line from decision-making to construction to debugging, often takes only 7-9 months in China, while European and American countries often It takes a year and a half. On the other hand, the amount of funds invested in China's PV industry this year is very large, which has also contributed to the rapid growth of China's photovoltaic industry.

Big trend four: The expansion of output of crystalline silicon solar cells is significantly faster than the expansion of thin-film solar cells. The reporter investigated changes in the proportion of solar cells with various industrial scales in the world photovoltaic industry from 1999 to 2010. It can be seen from the above that the production of thin-film batteries continued to decline before 2004, mainly due to the maturity of the crystalline silicon solar cell industry and the decrease in the cost of crystalline silicon solar cells. From 2004 to 2009, the share of thin-film silicon solar cells continues to grow, mainly due to the rapid expansion of crystalline silicon solar cell industry, resulting in a shortage of silicon materials, so the price of crystalline silicon solar cells continues to rise, resulting in the price of thin-film batteries Shows a clear competitive advantage.

In particular, the rapid growth of thin film solar cells in 2008 and 2009 was mainly due to the successful large-scale mass production of low-cost CdTe solar cells by First Solar Inc., resulting in a significant increase in the proportion of thin-film batteries. However, in 2010, the proportion of crystalline silicon solar cells rebounded sharply. The reason is mainly because after the economic crisis, the problem of shortage of silicon materials has been solved, the price of silicon materials has dropped sharply, and together with other technological advances that improve the efficiency of crystalline silicon solar cells, the price of crystalline silicon solar cells has dropped dramatically. As a result, the market share of crystalline silicon solar cells has increased dramatically.

Whether or not thin-film batteries can rapidly increase their market share in the future depends on the improvement of the technological maturity of thin-film batteries, the decline in equipment prices, and the improvement in efficiency.