Chinese PV Equipment Suppliers Grab Further Market-Share Gains

Emphasis on Cash Preservation Delays Technology-Buy Cycle as Tool Suppliers Look to 2013

San Francisco, Calif., January 16, 2012—Ambitious PV manufacturing capacity investments across the Asia Pacific region during 2011 have provided substantial revenue growth for local PV equipment suppliers, according to the latest NPD Solarbuzz PV Equipment Quarterly report.

Beneficiaries of these record investments include Japanese wire-saw producer Komatsu-NTC and an emerging group of Chinese tool suppliers that includes (Fujian) Apollo, 48th Research Institute (CETC-48), (Zhejiang) Jinggong, and Jingyuntong (JYT). Collectively, these four Chinese companies have posted a CAGR metric in excess of 200% for PV-specific equipment revenues covering the period from 2008 to 2011.

Applied Materials (AMAT) is forecast to retain the top spot as leading PV equipment supplier by recognized revenues. AMAT’s c-Si specific PV revenues for CY’11 are forecast to grow by more than 60%, as process tools for wafer and back-end cell production were widely implemented throughout all geographic regions and tier categories.

Many European equipment suppliers with a strong track record within the PV industry (Centrotherm, Meyer Burger, Schmid, RENA, Amtech-Tempress and DEK-Solar) are also forecast to post record PV tool revenues for 2011.

This is contrasted by other European suppliers that have seen their PV market share eroded by the new Chinese competition. Consolidated PV revenues of Roth & Rau, Manz, ALD-Vacuum, and PVA-TePla for 2011 are estimated to have been less than 50% of this grouping’s PV share in 2008.

Investment in turn-key a-Si lines—mainly from China—ensured continued revenue streams for Oerlikon and Apollo during 2011. While many thin-film investments are driven by unpredictable market-entry aspirations, this segment still offers attractive, but erratic, bookings potential for tool suppliers.

According to Finlay Colville, Senior Analyst at NPD Solarbuzz, “The euphoria of announcing record revenues for 2011 is countered by the realization that much of the tooling shipped last year was stimulated by highly ambitious capacity expansion plans that were not underpinned by market demand. Over-capacity reached chronic proportions across the c-Si value-chain during 2011, and only stronger than anticipated end-market demand in 2012 will mitigate a painful and severe equipment spending downturn.”

Equipment suppliers at risk of Y/Y revenue declines in the 60-70% range for 2012 are those most exposed to the c-Si ingot-to-module stages. Only GT Advanced Technologies, with strong market-share in polysilicon and downstream PV equipment (characterized by different spending cycles), is retaining healthy revenue guidance during and beyond 2012.

Figure 1: Leading PV Equipment Suppliers (c-Si poly-to-module and thin-film) by Revenue

Source: NPD Solarbuzz PV Equipment Quarterly
Market-share is determined using 3-quarter rolling averages (3QRA) of PV specific revenues recognized (Rev-Rec) across any given trailing twelve month (ttm) period. Above analysis incorporates NPD Solarbuzz PV Rev-Rec estimates for each supplier to 31 March 2012.

Technology-Buy Cycles Continue to Frustrate PV Equipment Suppliers

Excessive PV equipment that was shipped during 2011 is now contributing to a misleading (nameplate) capacity figure at the 50 GW level. However, many production lines are now shuttered, idled, awaiting tool installation, running at utilization rates below 50%, or simply not capable of meeting downstream requirements on cost or efficiency. As a result, annualized, effective (or commercial), ramped capacity is closer to 30 GW.

Dominated by tier 1 (and selected tier 2) manufacturers, the short-term goal has now shifted from adding more capacity to cash preservation and repairing damaged balance sheets during 2012. The rebound in equipment spending that will ultimately be driven by these manufacturers is therefore on hold until there is sufficient confidence that end-market demand will exceed the 30 GW mark.

In the meantime, PV equipment suppliers are eagerly searching for technology-buys that will both soften the revenue declines during 2012 and give a clear indication of the process tool types to be prioritized from 2013.

Changes in the c-Si equipment roadmap point firmly to an increase in high-efficiency cell variants, with over 75% of capacity added during 2012 capable of producing panels with efficiency gains of 0.5% or more, compared to industry averages through 2011.

“The strategic planning for PV equipment suppliers is now shifting to 2013 and beyond, with limited prospects for revenue upside in 2012,” added Colville. “Success will be provided to those suppliers that can align product portfolios with equipment process chains that are economic in the new low cost PV manufacturing environment.”

Figure 2: Technology Roadmap Trends for New c-Si Cell Capacity Added

Source: NPD Solarbuzz PV Equipment Quarterly
Standard: legacy p-type substrates, conventional process flows
Standard Extra: efficiency delta of 0.2-0.5%, one incremental change
High Efficiency (HE): advanced process flows, efficiency >1%, alternate process flow

The NPD Solarbuzz PV Equipment Quarterly report enables PV equipment suppliers to navigate these challenges by identifying target customers or competitors, equipment revenues on offer (down to the key process tool level), and the precise timing of each PV manufacturer’s fab expansions by quarter to 2015.

The NPD Solarbuzz PV Equipment Quarterly features a comprehensive capacity and production database, incorporating proprietary NPD Solarbuzz industry knowledge across over 380 c-Si cell and thin-film panel producers, and a PowerPoint report with extensive analysis on technology, equipment spending and market-share trends. All data and analysis is reworked every quarter and includes expansion and spending activity from the immediate quarter closed for over 1,300 capacity expansion phases at over 640 fabs. The performance of leading PV equipment suppliers is analyzed and forecast 12 months out, including PV-specific process tool revenues, bookings, and backlogs.

For more information or to order the NPD Solarbuzz PV Equipment Quarterly, contact us at one of our seven global locations, email us at contact@solarbuzz.com, or call Charles Camaroto at 1.516.625.2452 for more information.

About NPD Solarbuzz
NPD Solarbuzz, part of The NPD Group, is a globally recognized market research business focused on solar energy and photovoltaic industries. Since 2001, NPD Solarbuzz has grown its client-base to include many of the largest global PV manufacturers, major investment banks, equipment manufacturers, materials suppliers, hedge fund companies, and a vast range of other multi-nationals. NPD Solarbuzz offers a wide array of reports, including Marketbuzz, an annual global PV industry report, and Solarbuzz Quarterly, which details both historical and forecast data on the global PV supply chain. The company’s research also provides annual downstream PV market reports by region for Europe, Asia Pacific and US markets. In addition, Solarbuzz.com is a recognized and respected online resource within the solar industry. For more information, visit www.solarbuzz.com or follow us on Twitter at @Solarbuzz.

About The NPD Group, Inc.
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,800 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us or visit www.npd.com and www.npdgroupblog.com. Follow us on Twitter at @npdtech and @npdgroup.

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