The fall in Chinese demand in 2019 had led to a sharp fall in the prices of the upstream solar supply chain namely polysilicon, wafers, and solar cells. This has put a lot of pressure on the players which focus exclusively on those parts of the supply chain. Wacker the German chemicals giant which has a large presence in the polysilicon part has reported a huge loss for its polysilicon division as the price has crashed to as low as USD 5/kg as the supply glut grows as Chinese poly makers have expanded capacity rapidly which is much in excess of demand.

Others such as GCL have also felt the pressure along with Talesun. However, downstream Chinese solar giants such as Jinko, JA Solar and others have reaped the benefits as solar module prices have not fallen as dramatically at least in non-Chinese regions. These companies have benefited from lower input prices and have leveraged their international sales and marketing presence to sell large volumes at higher prices. As non-Chinese companies have more or less been bankrupted over the last decade, Chinese companies are set to continue reporting millions of dollars in profits.

Longi has become by far the largest and most profitable Chinese solar company with a strong presence across the supply chain. Its low-cost operations have also allowed it to earn much higher margins than the rest of the industry and it plans to increase its solar wafer capacity to 50 GW in the next 2-3 years which will give it a market share of more than 30%. While smaller Chinese companies have reported profits, they are much smaller as they do not have the heft to sell internationally in the numbers sold by the larger players such as Risen, Jinko, JA Solar and others. They are mostly restricted to the domestic market where the prices are quite low.

First Solar is the only large non-Chinese solar company which still has a decent presence as other Western companies have been killed by the relentless Chinese competition. Even Sunpower with the support of Total has given up on manufacturing unable to compete with the Chinese. A European research body European Commission’s Joint Research Centre has called for a large gigawatt manufacturing ecosystem to be set up in Europe to cater to the continents’ ambitious climate change goals but this looks unlikely as European solar manufacturers have all been bankrupted despite having huge initial advantages when the industry has started out in 2005.