Photovoltaic industry can only warm up for winter

With Germany and Italy, which account for 70% of global demand for photovoltaic products, gradually showing signs of waning effects, PV companies have already felt the chill. Wang Yichao, chief strategy officer of Yingli Group, stated that this “winter” may last for 18 months.

At present, the volume and price of PV market have dropped, and the price trend of PV market products depends on the strength of the market's next demand. Whether it is polysilicon, which has remained strong before, or the component that prices have been declining since the beginning of this year, the current price cannot be seldom talked about when. On May 30th, according to the latest analysis by the research institution IMS Re-search, the global inventory level of photovoltaic modules has reached more than 10GW, which is the highest inventory record to date. It can be foreseen that with the continuation of this market atmosphere, some companies that do not have the advantages of brand and cost will fall first, and companies with competitive strengths and complementary advantages will adopt the “horizontal warming” of vertical and horizontal cooperation in the industrial chain. It is an effective way to spend the "winter".

In the photovoltaic industry, it is not uncommon for industrial integration companies to cover the production of upstream silicon wafers and downstream components. Prior to this, the form of joint ventures between two photovoltaic companies in one industrial chain was very rare. Recently, as the largest polysilicon and wafer manufacturer in Asia, GCL-Poly has announced that it will jointly establish a silicon wafer plant with two photovoltaic companies, including Artes. Artes was originally a customer of GCL-Poly. Through joint ventures, the two parties established a closer interest community relationship. Altus will obtain a stable silicon material and also gain a corresponding share of investment income. For GCL-Poly, It can also be digested ahead of time. In the next two years, the total capacity will be doubled again. Faced with the advent of "winter", through the "bundle" cooperation between upstream and downstream of the industrial chain, it may be a realistic choice for related companies to achieve "preparation for a rainy day."

In addition, when the market is bad, maintaining adequate cash flow is a safer way to deal with future market variables. Having enough funds to face the next round of "bottom-hunting" opportunities, you can also be more relaxed and gain the initiative.

In the past two years, the market demand for the photovoltaic industry has been booming, and most photovoltaic companies have sufficient cash. At this point in time, however, the capital of major PV companies appears to be a little nervous. It is in this "cash is the king" consensus, the current photovoltaic companies to raise funds through multiple channels. Of course, companies want to obtain the lowest possible cost of funds, and in what ways will the company test the company's operating capabilities and wisdom, so each company is also in the way of the show is supernatural.

Yingli Group recently announced that Yingli China, a subsidiary of the company, has received a total of 1.16 billion yuan in five years for Shijiazhuang Branch of Shijiazhuang Bank and Baoding Branch of Bank of China**. This ** will be used to support the company's long-term development plan and ongoing expansion projects. After the frustration of the United States, Jiangxi LDK chose to cooperate with AVIC Trust to pledge goods worth 212.29 million yuan to AVIC Trust at a pledge rate of 70% and receive a trust of RMB 150 million for one year. GCL-Poly, with extensive experience in capital operations, has signed a strategic ** agreement with the China Development Bank, a policy bank, to safeguard the funding gap in the future.

It is worth noting that despite the low-speed growth environment of the photovoltaic industry, industry leaders are still invariably investing significantly in the “winter” approach. Wang Yichao, chief strategy officer of Yingli Group, stated that although the current situation of the PV industry is not optimistic, Yingli’s expansion plan will not change. It is expected that by the end of this year, Yingli’s production capacity will reach 2GW, and shipments will achieve 1.7GW.

In the medium to long term, the photovoltaic industry is still a sunrise industry, and at the time of “wintering”, the days of companies that do not have the advantages of scale and cost will be even more difficult. This may be an opportunity period for the dominant companies. The “reshuffle, mergers and reorganizations” that industry leaders have been expecting will also have conditions.