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In 2019, global PV module shipments grew by 30% and reached 138
GW as shown in IHS Markit's recently developed Global PV
Shipment Dashboard included in the
Solar PV Module service. The share of the top 20 players
continued to increase, reaching 71% of total shipments and
continuing the trend of consolidation throughout the supply chain
seen throughout the last decade. This indicates that the total
volume shipped by the top 20 players has increased more than nine
times since 2010.
Over the past decade, the top player rankings (by shipment
volume) have changed significantly with Chinese module
manufacturers becoming dominant among the top ten suppliers and
with Japanese and North American companies moving away from the top
positions. Despite dominance by Chinese manufacturers, there has
also been significant shifts within the top companies. Trina Solar
is the only company that has remained in the top five throughout
the last decade, with JinkoSolar, JA Solar, LONGi, and Canadian
Solar holding the rest of the top positions in 2019.
There is an ongoing debate about the likely emergence of new
political and economic measures in the post-COVID-19 world aimed at
encouraging the localization of manufacturing, that could trigger
the growth of capacity expansions outside of mainland China to
reduce the current over-reliance on this region. Although it is too
early to tell if some additional trade barriers, protectionist
measures, or local incentives might increase solar manufacturing
attractiveness outside of mainland China in regions like Europe,
IHS Markit analysis underscores that based on current capacity and
announcements, mainland China will continue consolidating its
dominance across the entire module supply chain in 2020
concentrating 70% of total module manufacturing capacity and even
higher for upstream nodes (i.e. polysilicon, wafers). Southeast
Asia and India are the only regions with a sizeable projection of
module capacity expansion, but they still relatively modest in
comparison to China mainland figures.
Figure 1: 2019 top 20 module players by shipment
PV module supply chain to see major oversupply in
2020
The solar manufacturing industry had been preparing for a record
year, with major capacity expansions announced to be ramped up in
the second half, particularly at the wafer and cell levels.
The updated
2020 solar installation forecast, reflecting the impact of the
COVID-19 outbreak, has instantly positioned the module supply chain
in a overcapacity situation. After a decade of solar PV
installations growing at double-digit rates each year, IHS Markit's
new outlook means that solar will decline for the first time this
year (-12% y/y). Installations are forecast to return to 2018
levels, but global module manufacturing capacity will be 37% higher
than it was that year.
The three major immediate consequences of oversupply in the
second half of the year will be (i) delay of some capacity
expansion plans until 2021, (ii) idling of multicrystalline
capacity due to low demand for this technology, and (iii)
significant component price declines. Chinese tier-1 manufacturers
will continue to account for the majority of capacity expansions in
2020, and the overcapacity will mostly affect smaller tier-2
players, higher-cost manufactures, and multicrystalline producers.
Top 20 module players are expected to gain market share again this
year.
2020 will be a critical year that will reshape the Solar PV
module manufacturing landscape. Many trends that had already been
taking place will be accelerated, with a different collection of
companies and preferred technologies emerging after the pandemic
has eased. After this major short-term disruption, installation
growth will resume from 2021 to continue the growth trajectory that
solar PV has seen in the last decade. IHS Markit projects a
recovery of utilization rates in 2021 across the entire module
supply chain.
IHS Markit experts are available for consultation on the
industries and subjects they specialize in. Meetings are virtual
and can be tailored to focus on your areas of inquiry. Book in a
consultation with Edurne Zoco.
Edurne Zoco is an Executive Director of Clean Technology
and Renewables at IHS Markit.
