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explo

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Thursday, January 10th 2013, 4:58am

IHS reports major shakeout

http://www.solarserver.com/solar-magazin…rvive-2013.html

http://www.digitimes.com/news/a20130110PR200.html

Spectacular PV exit numbers. In 2013 alone 70% of the companies will close shop. In 2010 there were PV 750 companies, 100 folded in 2011, another 150 folded in 2012 and yet another 350 will fold in 2013 and only 150 will remain entering 2014. This should be very good news for the backed solar 11's. ThinFilm and high cost c-Si won't make it unless they have special downstream or emerging market channeling strategies - such solution are only short-term though as markets mature to choose lowest cost solutions. High cost upstream won't make it. Most have already closed by now and will never open up again.

The cost cuts we've seen in raw material procurement (silver paste ect.) should continue, since the logistics and SG&A cost for suppliers goes down when their target market consolidates allowing them more room to reduce price.

The report says that there's no guarantee the shakeout will help survivors, but such a huge shakeout can't hurt.

explo

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Thursday, January 10th 2013, 5:13am

Here's an interesting Q&A with Giga Solar's chairman explaining how the consolidation lowers the cost in the supply-chain:

http://www.digitimes.com/news/a20130102PD203.html

And here's more reports on the market exits (seems number vary a bit):

http://www.digitimes.com/news/a20130110PD205.html

larryvand

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Friday, January 11th 2013, 2:36pm

Market forecast: Less than one third of PV producers will survive solar shake-out in 2013

Market forecast: Less than one third of PV producers will survive solar shake-out in 2013

11.01.2013: US market research company IHS iSuppli predicts that the current consolidation of the world solar industry will lead to major losses among the around 500 global players still active in 2012. According to the company, around 150 companies will survive the solar shake-out. “Most upstream PV supply operations will simply cease to exist, rather than being acquired by other companies,” says IHS. It also predicts that especially Chinese integrated producers are at risk in 2013. However, IHS notes that low-cost players will play a major role in the global market also in the current year. Source: IHS iSuppli

http://www.isuppli.com/Pages/Home.aspx

http://www.isuppli.com/Photovoltaics/New…-This-Year.aspx

The complete press release can be viewed in PHOTON's archive using the following link:
http://www.photon-international.com/news…ument/73045.pdf

larryvand

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Tuesday, January 15th 2013, 6:34pm

Number of Companies in the Solar Supply Chain Set to Plunge This Year

http://www.isuppli.com/Photovoltaics/New…-This-Year.aspx
January 9, 2013
MICHAEL SHEPPARD

Amid rapidly falling prices, mounting losses and massive operational costs, the upstream solar photovoltaic (PV) supply chain is undergoing major consolidation, with the number of companies participating in the market expected to plunge by 70 percent this year.Worldwide, the total number of companies participating directly in the manufacturing of PV solar panels, from polysilicon manufacturing through module assembly, is set to fall to approximately 150 in 2013, down from about 500 in 2012, according to the IHS Solar service at information and analytics provider IHS (NYSE: IHS). This compares to about 650 in 2011 and 750 in 2010, as presented in the figure below.

“It would be a major understatement to say that consolidation is occurring in the PV supply chain this year,” said Mike Sheppard, senior photovoltaics analyst with IHS. “Most upstream PV supply operations will simply cease to exist, rather than being acquired by other companies. Most of these suppliers actually have already stopped production—and will never restart.”

Consolidation Casualties
Companies at the highest risk of going out of business in 2013 include integrated suppliers that manufacture PV polysilicon, ingots, wafers and cells to offer complete solutions. Second- and third-tier suppliers of crystalline silicon (c-Si) polysilicon, ingots, wafers, and cells also will struggle to stay afloat. Finally, smaller thin-film cell providers likewise will face low sales and limited market sizes, putting them on the endangered list.

The Disintegration of Integration
Many integrated players will fold up shop in 2013 as the large expense of building integrated facilities—and then seeing them underutilized for the better part of a year—will prove to be financially unsustainable. Many of these players are based in China.

Government subsidies could be an option to keep integrated suppliers operating. However, while IHS believes that some supplier may be propped up by the Chinese government in 2013, the majority will dissolve.

Second-tier Survival Tactics
With price declines still occurring across the board in 2013, low-cost players will get the lion’s share of the global market. Upstream second- and third-tier suppliers of polysilicon, ingots, wafers and cells will struggle to survive the year in markets that do not have local-content requirements. Many of these companies will not be able to float operations for a very long period of time.

For second-tier module manufacturers, the key to surviving in 2013 will be establishing and maintaining strong relationships with downstream players in the emerging markets. Second-tier manufacturers must move faster than those in the top tier in order to grab mindshare early.

Flexible business models, with consistent outsourcing, will be needed to succeed. Because contract manufacturers require certain levels of business to remain profitable, securing stable relationships with these companies is also critical for second-tier module manufacturers.

Second-tier module makers also must be flexible enough to capitalize on the volatility in high-growth markets, which consist mostly of small and midsized engineering, procurement and construction (EPC) companies. These companies initially have less allegiance to established top-tier manufacturers. But as their experience in this area grows, price becomes a primary factor, favoring low-cost producers. This is already true in markets like India, and is becoming a factor in Latin American countries such as Chile.

Thin Prospects for Thin Film?
Thin-film module manufacturers will have to adopt similar survival strategies as the second-tier c-Si module suppliers. This will be particularly true if pricing for thin-film modules doesn’t remain competitive with c-Si during the year. If thin-film pricing does not decline at the same rate as c-Si, the technology will be relegated to select niche markets that generate scant demand.

No Guarantees
Module suppliers in these three categories—integrated manufacturing, specialized second-tier manufacturing, and thin film manufacturing—will experience the toughest challenges in 2013 given the hurdles needed to make those operations successful. Because of such challenges, some of these companies will fail.

Consolidation and reduction in a supply chain results in capacity being taken offline, often benefiting the remaining players in a market. But given the weak conditions in today’s PV market, there is no guarantee that the supply-chain shakeout will help surviving suppliers in 2013—or even make it less likely that they will fail.

An extensive whitepaper presenting IHS’s top 10 predictions for the solar industry in 2013 can be downloaded here.

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