Solar energy industry representatives from China and Taiwan yesterday agreed that they would need to collaborate on manufacturing and technological research and development (R&D) to stem falling solar cell prices and digest inventories if they are to avoid a dilemma similar to the one hurtin the global dynamic random access memory (DRAM) industry.
Solar cell makers suffered their worst financial performance in the first quarter as a result of the global financial crisis and Spain’s reduction of solar cell orders, Motech Industrial Inc (茂迪) chairman and chief executive officer Simon Tsuo (左元准) said at an industry forum in Taipei.
Plummeting solar cell prices, which have created a buyer’s market and, subsequently, a buildup of huge inventories among manufacturers as a result of their customers’
wait-and-see attitude, have also eroded profitability, he said.
Auria Solar Co (宇通) chairman Tsai Jin-yao (蔡進耀) expressed similar views during the forum held at the Taipei International Convention Center.
“Global buyers are seeking Chinese prices at Taiwanese quality, making it impossible for cross-strait firms to be profitable when the two countries are constantly engaged in a cutthroat price war,” he said.
To prevent such friction in the burgeoning green technology industry, Minister of Economic Affairs Yiin Chii-ming (尹啟銘) proposed cross-strait solar supply chain collaboration through capital infusions from both sides in joint investment, R&D and solar cell production.
Instead of competition resulting in repetition in upstream technology, China and Taiwan can “work with each other in downstream solar technology with Taiwan sharing our expertise in battery and panel making, for example,” Yiin said.
The ministry earlier this week proposed allowing Chinese investors to indirectly acquire stakes of up to 30 percent in local companies. Yiin said the Cabinet would likely approve the measure by the end of this month, when the ministry is to release the list of domestic sectors that would be qualified to receive Chinese investment.
During yesterday’s forum, Tsai pushed once again for the government to pass a proposed statute governing the development of renewable energy (再生能源發展例), which has been delayed at the Legislative Yuan for more than eight years, in order to promote the cross-strait solar agenda.
This would no doubt bring tremendous opportunities to Taiwan, he said.
“And once China and Taiwan have become the dominant solar energy players, we can be the ones to set global solar standards and be the leader in this industry,” Tsai said.
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