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Solar Panel Prices to be Lowered or Stabilised Even With Material Prices Increasing

Despite higher polysilicon prices, most Greater China solar panel manufacturers say they plan to lower or keep prices steady to win market share. This is according to Global Sources' China Sourcing Report: Solar Panels.

The Report shows 88 percent of suppliers plan to decrease or keep prices stable, while only 12 percent plan to increase prices.

"With the polysilicon shortage expected to continue until 2009, most manufacturers are implementing measures to streamline production," said Report publisher, Spenser Au. "These include expanding to gain economies of scale, backward integration and R&D to produce thinner solar cells that require less polysilicon."

Among respondents' plans to lower production costs:

  • 28 percent are looking for ways to reduce waste;
  • 27 percent are increasing automation; and
  • 25 percent are upgrading management systems.

The remaining 20 percent say they plan to focus on vertical integration and decreasing defects to improve manufacturing efficiency.

Au said: "Manufacturers are generally optimistic, with 97 percent expecting exports to increase over the next 12 months. However, with excess capacity in the high double-digits, a larger number of suppliers are reducing prices to gain orders."

Among surveyed suppliers' primary concerns for the next 12 months:

  • 60 percent cited price competition;
  • 25 percent said raw material costs;
  • 7 percent indicated stricter overseas standards;
  • 5 percent cited design copying; and
  • 3 percent indicated labor shortages.

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