Over the last few years, multiple leading Chinese PV manufacturers have diversified a certain percentage of their total production capacities outside mainland China. The main drivers behind this move have been the country-specific non-tariff trade barriers against the import of PV cells and modules from certain countries of origin. In addition, the US recently imposed a 50% tariff hike on imported Chinese solar cells and announced a resumption and extension of anti-dumping and countervailing duties (AD/CVD) to more Southeast Asian countries. These only further underscore the need for Chinese cell makers to devise a diversification strategy.
China-based SolarSpace, a well-known solar cell vendor recently turned module maker, is unique in that it has built production capacity in Laos. The company’s Corporate Vice President, James Hu, spoke about the rationale behind this move and the company’s business strategy for the US market at RE+ 2024.
Here is a summary of the interview.
TaiyangNews: It is great to talk to you here at RE+. So talk a little bit about SolarSpace’s latest product developments.
James Hu: As you can see, we have a beautiful booth here at RE+ and are very happy to be here. We bring our core product to the show this year, which is our solar cells. We have 6 kinds of cells including 182 mm PERC and n-type cells. We also have specifications like the 210 mm and 210R size rectangular n-type cell at the booth. Apart from the cells, we also have our PERC and n-type modules on display.
TaiyangNews: You said you are in the cell space and also in modules. SolarSpace is a popular name among cell vendors, and this sector is simply growing every day. Can you please give us a bit of background on your activities and capacities for those new to your story?
James Hu: Let me take this opportunity to talk a bit about the company. SolarSpace has been in this industry for over a decade with solar cell manufacturing at its core. As of the end of June 2024, we had 60 GW of solar cell capacity. Among those, we have 15 GW in Laos, the Southeast Asian country. SolarSpace supplies solar cell products to almost every leading module manufacturer. In addition to that, SolarSpace is also a Tier 1 module producer, supplying directly to some of our key EPC partners and project developers.
TaiyangNews: But SolarSpace is special in that it is not only one of the leading cell suppliers in the world but also a Chinese company producing cells outside of China. This is also very interesting for the US, right?
James Hu: That’s right. As I said earlier, we have 15 GW cell and 3 GW module capacity in Laos. This puts us in a very unique position to serve the US market.
TaiyangNews: Can you talk a little bit about your Laos factory? SolarSpace is the only big player producing cells and modules in Laos, right?
James Hu: That’s right. Laos is not subject to potential AD/CVD investigations, that’s right. We actually had production capacity in Cambodia, but we built production capacity in Laos about a year ago. We have already started building our third facility in Laos – the first two are for solar cells, and the third is for modules. Put together, we already have 15 GW of cell and 3 GW of module capacity.
TaiyangNews: We have heard about solar companies moving their manufacturing to Malaysia and Vietnam, and Indonesia more lately. What made you identify Laos as the destination for your manufacturing?
James Hu: Before we make an investment, we need to do our homework, study the market, and make sure where we can achieve cost-effectiveness along with the desired product quality. Laos has good labor availability. The availability of good labor and technical engineers in Laos also helps us guarantee top quality. And we have good infrastructure supporting our capacity there. Also, the cost structure is reasonably competitive there, which helps us be cost-effective with our products. These are the reasons for building capacity in Laos.
TaiyangNews: Just a few words on the current business environment. We know it’s difficult. There are overcapacities on the one hand. On the other hand, prices are really under pressure. What is SolarSpace’s strategy in this regard?
James Hu: Overcapacity is one of the biggest challenges for the whole industry currently. However, we are still very confident in the long-term development. We need to have a long-term thinking and strategy. In my opinion, the industry will continue to see around 20% to 30% compound annual growth rate. Of course, we do not like the current situation. But at SolarSpace, we are focused on how to improve our value in this solar community. For us, it’s efficiency, both the product and operational efficiency, and also guarantee top product quality. I would say it is also important to enhance and practice ESG standards. I believe all these strategies will help SolarSpace stand out in this community.
TaiyangNews: You also probably stand out simply because you offer high-quality cells, right? Because I think the tendency in the industry is rather to become a full solution supplier, so everyone is trying to do everything. But you are also offering your cells to small and medium-scale customers, right?
James Hu: As I said earlier, our core business will still position us as a close partner for our community in this industry. For example, we supply our cells to our module partners, the leading module manufacturers. In addition to that, we also supply our Tier 1 module products to some of our key clients. So that’s our positioning in this community and we are going to continue with this strategy.
TaiyangNews: Sounds interesting. Thanks a lot for the interview, James.