Best and Worst Times Coexist: How the Photovoltaic Industry Breaks the Cocoon and Becomes a Butterfly in Pain

2024-08-01

After a year, we are once again gathered in Shanghai, and the photovoltaic industry is experiencing a dual transformation and development. The industry is facing the strongest 'internal competition' in history, with serious supply-demand mismatch and the industry entering an ice age. "On June 11th, Zhu Gongshan, Chairman of GCL Group, expressed his emotions at the 17th (2024) SNEC PV+International Solar Photovoltaic and Smart Energy (Shanghai) Conference and Exhibition (hereinafter referred to as" SNEC ").

Compared to last year's SNEC, the current photovoltaic industry is going through a painful period, which can be described as internal and external troubles. As of now, the four major manufacturing processes of photovoltaics have basically fallen below cash costs, putting pressure on collective profits. At the same time, the upgrading of trade barriers has led to a contraction in external demand and a decline in exports.

SNEC is a barometer and indicator of the global photovoltaic industry, as well as the main battlefield for photovoltaic practitioners to gather wisdom and exchange ideas. The reporter from China Business News learned from the meeting that at this photovoltaic feast, photovoltaic experts all faced the lessons and deeply reflected. Some people believe that after 20 years of intense competition in photovoltaics and four crises, this time is not easy.

In Zhu Gongshan's view, photovoltaics is experiencing a super "internal competition" due to the combination of factors such as homogeneous competition on the supply side, blind obedience of capital, cross-border squeezing, local government investment promotion and agency construction drive, and low price bidding on the demand side, leading the industry into a trap of "local optima" rather than "global victory". Looking at the essence through the phenomenon, the intensification of "internal competition" is closely related to the misjudgment of supply and demand in the entire industry, as well as the insufficient entry threshold caused by the industry touching the ceiling of inherent technology.

At present, the best and worst moments coexist in China's photovoltaic industry, and it is in an important period of transformation from cocoon to butterfly in pain. The industry is not going through the cyclical iteration of the past three to five years, but rather a rehearsal before the arrival of the era of great changes in photovoltaics. Zhu Gongshan believes that it is not advisable to rise in one fell swoop and disperse in one fell swoop. China's photovoltaic industry urgently needs the government's "tangible hand" and the market's "intangible hand" to simultaneously exert structural regulation with improving technical standards and market access thresholds as the main means.