Global spending on solar PV manufacturing equipment could grow sharply, reaching about $43.8 billion annually by 2035, according to a VDMA-commissioned report
It could create a cumulative market of $250 billion to $300 billion over the next decade
China continues to dominate PV manufacturing with more than 80% of global silicon-based production capacity, even though European equipment scores for offering longer lifetimes and process stability
Europe has strong research capabilities, especially for emerging technologies, but limited domestic manufacturing capacity could affect competitiveness
Global spending on solar PV manufacturing equipment could rise sharply over the next decade, according to a new industry report by Fraunhofer Institute for Solar Energy Systems ISE (Fraunhofer ISE) and ISC Konstanz. It forecasts annual capital expenditure to grow from $16.6 billion in 2025 to $43.8 billion by 2035.
It will lead to a cumulative global market volume of $250 billion and $300 billion over the next decade as various countries expand solar production capacity.
The outlook comes from the European Photovoltaics Machinery and Equipment Study commissioned by the German Engineering Federation (VDMA).
Heavily subsidized Asian competitors continue to dominate the global solar PV manufacturing space, led by China, which commands over 80% of production capacity across all stages of the silicon-based value chain. An analysis shows that while competitors have been able to increase throughput and productivity, European equipment still scores in terms of equipment lifetime and process stability.
Yet, European manufacturers lack a strong home market for their equipment. While there have been announcements for GW-scale manufacturing, tangible investment remains limited.
As of 2025, the operational annual production capacity of polysilicon in the European Union (EU) stood at 9 GW, solar cells 2.9 GW, and modules 6.6 GW. No ingot or wafer capacity existed. Based on public announcements, the bloc is likely to see 10 GW of ingot and wafer capacity each, 22.2 GW of cells, and 32.5 GW of modules.
Under an optimistic scenario, the report writers believe the EU could have operational capacities of 9 GW for polysilicon, 10 GW each for ingots and wafers, 27 GW for solar cells, and 44.6 GW for modules by 2030.
Fraunhofer ISE’s Director Photovoltaics PD, Dr. Ralf Preu, explains, “Europe continues to develop high efficiency solar manufacturing technologies, but without large scale industrial deployment at home, competitiveness is at risk. We do have research excellence, we need real factories with industrial excellence.”
Globally, the solar PV market is projected to grow about 2.5 times by 2035, reaching around 1,650 GW of new annual installations. There are growing opportunities to expand European manufacturing with the advent of newer technologies, such as back contact (BC), heterojunction (HJT), and tandem cells. Europe already has strong experience with the current industry workhorse, TOPCon.
“European machinery already demonstrated its strength in current TOPCon technology. The technological shift to Back contact, HJT, and tandem cells creates significant opportunities for European equipment suppliers,” said ISC Konstanz Co-Founder Dr. Radovan Kopecek. “But speed matters customers increasingly prioritise short payback cycles, integrated solutions, and fast response times.”
As competition heats up beyond China, with countries like India and the US emerging as new manufacturing markets, report writers have some recommendations for European companies. These include expanding their turnkey capabilities, developing risk-sharing business models, strengthening after-sales service structures, and improving local presence in key markets.
They also call for decisive action from both industry and policymakers for more coordinated industrial strategies at the European level, including targeted investment support and procurement programs.
The complete report is available for free download on VDMA’s website.
In a September 2025 report, Fraunhofer ISE and SolarPower Europe recommended urgent policies and support, including CapEx, OpEx, and output based incentives to shrink the EU-China cost gap for EU-made solar modules (see Fraunhofer ISE & SolarPower Europe Chart EU’s Solar Reshoring Path).
