Chinese Solar Panel Maker Falters as Prices Plunge
Source: New York Times
Chinese Solar Panel Maker Falters as Prices Plunge
By KEITH BRADSHER
Published: March 20, 2013
HONG KONG — Suntech Power, a Chinese manufacturer that became the world’s largest producer of solar panels by 2011 only to be battered by plummeting prices, announced on Wednesday evening that its main operating subsidiary had been pushed into bankruptcy by eight Chinese banks.
Suntech was the Icarus of the solar panel industry, with production that soared year after year on heavy investment, as Western investors bought up its New York-traded shares and its international debt issues. Part of a massive Chinese government effort to dominate renewable energy industries, Suntech grew to 10,000 employees in its hometown of Wuxi on China’s east coast and even set up a small factory in Arizona to do further assembly of panels there.
But a tenfold expansion of overall Chinese solar panel manufacturing capacity from 2008 to 2012 pushed down prices of solar panels about 75 percent, undermining the economics of the business. Rapid expansion of natural gas production in the United States and a curtailment of subsidies in the European Union also hurt solar panel prices, as did an American imposition last year of import tariffs totaling about 40 percent after an anti-dumping and anti-subsidy investigation.
The European Union is also completing its own trade investigation of Chinese solar panel shipments that could lead to steep tariffs there as well.
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Read more: http://www.nytimes.com/2013/03/21/business/energy-environment/chinese-solar-companys-operating-unit-declares-bankruptcy.html