Chinese Solar Inverter industry set to grow

China has managed to become the dominant manufacturer of solar wafers to panels in the world, with a market share of more than 60%. The country made massive investments into this new green technology and went from around 0% in 2007 to its leading position now. Even solar inverter space where the country was quite weak in till 2012, has seen major Chinese companies such as Sungrow and Huawei become top solar inverter providers globally. This has also brought a massive decline in costs and prices, bankrupting many of the western companies which did not have the efficient low cost structure of the Chinese companies. Despite being global leaders in making solar wafers and panels, there was no big Chinese company that supplied capital equipment to the Chinese companies. German and USA companies such as Centrotherm, GT Advanced Technology and Roth & Rau used to dominate equipment manufacture. These companies saw a massive boom during 2010-2012, when hundreds of Chinese companies entered the solar cell and panel production buying equipment from the Western companies.

However, the massive downturn post 2012, led to the bankruptcy of many of these Western equipment manufacturers such as GT. Other players such as Applied Materials sold off their solar divisions or shuttered them as orders dried up. Chinese companies have used this opportunity to become major equipment makers as well. These companies have used the favored option of supplying dirt cheap equipment at extremely low margins to win orders.

Now some of these companies have become the Top 10 solar equipment makers and are even being used by companies outside of China to produce solar cells and panels. Horad has come from almost nowhere to become the solar module automation equipment provider of choice to many of the big players. I expect that from the low technology module assembly, Chinese companies could also start entering the solar cell and wafer manufacturing given the vacuum left by Western companies.