PV companies should be careful when building overseas

As the global solar market becomes more competitive, an increasing number of Chinese photovoltaic (PV) companies are exploring opportunities to build factories abroad or partner with OEMs in order to avoid price commitments. However, establishing overseas manufacturing facilities is far from a straightforward strategy. Many domestic PV firms have found that setting up operations abroad comes with significant risks, long-term investments, and complex regulatory challenges. The European Commission has also taken notice of these moves, and it is now considering stricter oversight on Chinese PV companies that might be using offshore bases to circumvent trade restrictions. This heightened scrutiny reflects growing concerns over potential unfair practices in international trade. On August 6, 94 Chinese PV companies were granted temporary relief from anti-dumping duties on silicon wafers, cells, and modules exported to the EU, under a new price commitment agreement. The terms require that the price of PV modules exported to Europe must not fall below 0.56 euros per watt, and annual exports must not exceed 7 GW. While this agreement marks a first for China-EU trade relations, its impact on individual companies remains limited. At 0.56 euros per watt, Chinese manufacturers struggle to remain competitive, especially given rising production costs and intense global competition. Moreover, the agreement includes flexible terms, which may change depending on market conditions in May and June of this year. This uncertainty makes it difficult for companies to plan long-term strategies. Additionally, any company that shifts production overseas will now face increased scrutiny from the EU, which requires them to justify the purpose of their foreign investments. If the EU determines that such moves are aimed at evading price limits, it could result in penalties. This trend of moving production abroad is not new. In 2011, during U.S. anti-dumping investigations, many Chinese PV giants considered expanding overseas to avoid high tariffs. Ultimately, they found alternative solutions, such as importing components from Taiwan. Today, more companies are following a similar path, with only a few—like China Light and Power, Suntech, and Artes—having established overseas plants. Despite these efforts, the industry still relies heavily on exports and scale-based competition. With the Chinese government encouraging domestic market growth, companies should focus on innovation and technology rather than just expansion. Building a strong foundation through R&D can provide long-term advantages in a rapidly evolving industry. Currently, China’s PV sector still lags behind global leaders in cutting-edge research, advanced equipment manufacturing, and next-generation cell development. Therefore, technological advancement remains the key to industry transformation. Companies like Hanergy are taking steps to close this gap. On July 25, Hanergy successfully acquired GlobalSolarEnergy, a U.S. firm, becoming the first company to mass-produce flexible thin-film solar modules. This acquisition marks a major milestone in Hanergy’s global integration strategy and signals a shift toward higher-value, innovative products. Additionally, energy storage solutions developed by Sumida and Tianjin Electric Drive Design Institute have gained recognition in Germany’s home solar market. These products, certified by TUV, highlight how innovation isn’t just about technical performance but also about commercial viability. As more Chinese PV companies invest in R&D, the industry stands to benefit from a stronger, more sustainable future.

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