Global solar module pricing stabilizes in Q1; some suppliers to return to profitability in 2013

IHS reports that global gross margins for PV modules rose 1% in the first quarter of 2013 and is expected to reach 6% by the end of the year.

09/10/2013


Marking the end of more than two years of sharp declines, pricing for solar photovoltaic (PV) modules achieved stability in the first quarter, paving the way for a rise in industry gross margins and return to profitability for some leading suppliers this year.

After falling throughout 2012, global gross margins for PV modules rose to 1% in the first quarter, up from zero in the fourth quarter of 2012, according to a new report entitled “IHS Solar Integrated PV Market Tracker” from information and analytics provider IHS. Buoyed by rising prices, the industry-wide gross margin is expected to climb throughout 2013 and reach 6% by year-end. 

“The long-suffering solar module market has clearly turned around, with the industry finally on a growth path—not only in terms of output—but also for revenue and earnings,” said Stefan de Haan, principal PV analyst with IHS. “Despite a slight decline in industry-wide production, shipments, revenues, and factory utilization in the first quarter, the major market upswing in the fourth quarter of 2012 marked the end of the long downturn. While the market rebound won’t be high enough to push the entire industry into profitability this year, some top players have already achieved double-digit margins, and should be back in the black by the end of 2013.”

The No. 1 and No. 5 ranked module suppliers in the first quarter—Yingli and Canadian Solar—have issued guidance for gross margins of around 10% for the second quarter. With the global blended average selling price (ASP) for solar modules is expected to decline only moderately in 2013 to $0.71 per watt in the fourth quarter at the end of this year, down from $0.74 per watt in the first quarter, and polysilicon prices hovering around $20 per kilogram, these companies could expand their margins to 15% and finally return to profitability. 

China downshifts as Japan goes into high gear

Despite the signs of a market recovery, the leading Chinese manufacturers reduced their output slightly in the first quarter compared to the fourth quarter of 2012. Yingli and Canadian Solar, along with No. 2 Trina, and seventh-place JA Solar all reduced production amid growing concerns about the EU antidumping case and a general seasonal softening of global demand in the first quarter. 

In contrast, the Japanese manufacturers, including No. 3 Sharp and No. 6 Kyocera, increased their production significantly in the first quarter. IHS Solar estimates Sharp’s output rose by 80 MW while that of Kyocera expanded by 100 MW when compared to the fourth quarter.



Top Plant
The Top Plant program honors outstanding manufacturing facilities in North America.
Product of the Year
The Product of the Year program recognizes products newly released in the manufacturing industries.
System Integrator of the Year
Each year, a panel of Control Engineering and Plant Engineering editors and industry expert judges select the System Integrator of the Year Award winners in three categories.
October 2018
Tools vs. sensors, functional safety, compressor rental, an operational network of maintenance and safety
September 2018
2018 Engineering Leaders under 40, Women in Engineering, Six ways to reduce waste in manufacturing, and Four robot implementation challenges.
July/Aug
GAMS preview, 2018 Mid-Year Report, EAM and Safety
October 2018
2018 Product of the Year; Subsurface data methodologies; Digital twins; Well lifecycle data
August 2018
SCADA standardization, capital expenditures, data-driven drilling and execution
June 2018
Machine learning, produced water benefits, programming cavity pumps
Spring 2018
Burners for heat-treating furnaces, CHP, dryers, gas humidification, and more
October 2018
Complex upgrades for system integrators; Process control safety and compliance
September 2018
Effective process analytics; Four reasons why LTE networks are not IIoT ready

Annual Salary Survey

After two years of economic concerns, manufacturing leaders once again have homed in on the single biggest issue facing their operations:

It's the workers—or more specifically, the lack of workers.

The 2017 Plant Engineering Salary Survey looks at not just what plant managers make, but what they think. As they look across their plants today, plant managers say they don’t have the operational depth to take on the new technologies and new challenges of global manufacturing.

Read more: 2017 Salary Survey

The Maintenance and Reliability Coach's blog
Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
One Voice for Manufacturing
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Maintenance and Reliability Professionals Blog
The Society for Maintenance and Reliability Professionals an organization devoted...
Machine Safety
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
Research Analyst Blog
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Marshall on Maintenance
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
Lachance on CMMS
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
Material Handling
This digital report explains how everything from conveyors and robots to automatic picking systems and digital orders have evolved to keep pace with the speed of change in the supply chain.
Electrical Safety Update
This digital report explains how plant engineers need to take greater care when it comes to electrical safety incidents on the plant floor.
IIoT: Machines, Equipment, & Asset Management
Articles in this digital report highlight technologies that enable Industrial Internet of Things, IIoT-related products and strategies.
Randy Steele
Maintenance Manager; California Oils Corp.
Matthew J. Woo, PE, RCDD, LEED AP BD+C
Associate, Electrical Engineering; Wood Harbinger
Randy Oliver
Control Systems Engineer; Robert Bosch Corp.
Data Centers: Impacts of Climate and Cooling Technology
This course focuses on climate analysis, appropriateness of cooling system selection, and combining cooling systems.
Safety First: Arc Flash 101
This course will help identify and reveal electrical hazards and identify the solutions to implementing and maintaining a safe work environment.
Critical Power: Hospital Electrical Systems
This course explains how maintaining power and communication systems through emergency power-generation systems is critical.
Design of Safe and Reliable Hydraulic Systems for Subsea Applications
This eGuide explains how the operation of hydraulic systems for subsea applications requires the user to consider additional aspects because of the unique conditions that apply to the setting
click me