Tuesday, April 10, 2012

Trina Considering U.S. Factory to Increase Solar Market Share

Trina Solar Ltd. (TSL), China’s third- biggest maker of solar panels, may build a U.S. factory to increase its market share as President Barack Obama’s administration imposes tariffs on solar equipment imported from China.

Trina is evaluating strategies to increase U.S. sales and minimize the impact of the tariffs, Chief Executive Officer Gao Jifan said in an interview in Shanghai yesterday.

A U.S. production facility would let Changzhou-based Trina avoid duties imposed on solar panels produced in China. The U.S. Commerce Department announced tariffs on all Chinese producers March 20 and singled out Trina for the highest rate, 4.73 percent.

“We’re evaluating possibilities to build a production plant in the U.S.,” Gao said. “We’ll continue to support the American market, no matter how bad the final determination is made to impose tariffs on Chinese imports.”

The company last year had about 17 percent of the market in America, which added about 2 gigawatts of modules, he said. This year, Trina expects to “reinforce or raise” that figure. Trina has begun to outsource production to overseas companies to meet demand from the U.S.

The duties announced this week may be increased in May, after the Commerce Department rules on a second case, which alleges the Chinese producers sell their solar products at a loss to drive out competition. The agency didn’t say why Trina received the highest duty. Suntech Power Holdings Co. got a 2.9 percent tariff and all other Chinese producers will pay 3.61 percent.

The U.S. unit of SolarWorld AG (SWV) and six other U.S. manufacturers brought the complaints.
Increasing Shipments

The biggest Chinese companies expect higher shipments even as analysts predict the first drop in sales of solar modules in a decade. Homes and businesses will add 24.8 gigawatts of solar panels across the world, the average of six forecasts compiled by Bloomberg News. That’s equal to the power of about 20 nuclear reactors and down 10 percent from 2011 installations.

The top 10 module producers are gaining market share, Gao said. “Consolidation is weeding out uncompetitive firms” and will accelerate in 2012, he said.

Trina said Feb. 23 it would boost shipments as much as 39 percent to 2.1 gigawatts in 2012. Yingli Green Energy Holding Co. (YGE) expects shipments of as much as 2.5 gigawatts, up 56 percent. Suntech said it expects a 19 percent gain to 2.5 gigawatts.

“We’ve seen price declines alleviating in the first quarter and the drop will slow down this year compared with last year,” Gao said. “There’s likely to be a revival in profits in the second half, while it’s hard to predict the degree.”

SOURCE: http://www.businessweek.com/news/2012-03-21/trina-considering-u-dot-s-dot-factory-to-increase-solar-market-share

No comments: