Thursday, January 17, 2013

PV equipment spending downturn for 2013

An in-depth analysis of the PV equipment market by NPD Solarbuzz reveals the full scale of the impact the overspending / over investing of the past years has on the technology market right now. Finlay Colville expects the spending level in 2013 to be around $2 billion, which is a fraction of the once $12 - $13 billion recorded in 2011.

What will the effects be? Technological development in the field of production technology will come to an almost complete halt, equipment suppliers will have to reduce operative and management staff and cash-out will be very closely guarded. Basically everyone is trying to hold their breath until 2014/2015 when the markets will come closer to a match between available production capacity and market demand.

With the restructuring of GT Advance Technologies, the downsizing of Meyer Burger and refocussing of Applied Materials it appears that this process in ongoing. The insolvency of German supplier Centrotherm points in the same direction.

The political question in this analysis is what we can do to protect the know-how and the structure that we currently have in place in order to not lose more of our solar capacity when the upturn occurs. Right now cash is king so downsizing and hedging are the strategies for independent suppliers that we're already observing. Some of the suppliers will most likely consolidate into bigger corporations or groups while others will need to rely on liquidity help in order to survive. We'll keep watching and reporting.

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