Chinese PV makers react to trade dispute

As EU member states review the proposed tariffs on Chinese solar imports, Chinese solar panel makers are taking action and shifting their business strategy.

The on-going trade dispute has squeezed Chinese solar panel makers' profit margins to almost zero, factories are slashing costs by automation. This means fewer workers and higher production capability.

"The number of our production workers has decreased from 900 people in the early 2012 to 600 people now," said Andy Feng, production director of Shanghai Shenzhou New Energy Developme.

The European Union accuses China of offering cheap credit to its solar panel factories. But Chinese companies deny the charge.

"That is not like that at all, if you get a line of credit from Chinese bank for project. You have to go through exhaustive procedure to prove the return of investment of that project to …let's say…CBD. Otherwise we won't get funded. Actually there's very little funding," said Jonathan Pickering, VP of global marketing of China Sunergy.

The average prices of solar panels have dropped 70% since 2011. In order to stay afloat, many Chinese solar panel makers are turning their attention to the home market.

"All of our production lines are working at the moment. Because the domestic market is going up, there are a lot of orders," said Andy Feng, production director of Shanghai Shenzhou New Energy Development.

The EU's anti-dumping plan affects over 100 Chinese companies and 21 billion euros of trade value a year, this is the EU's largest ever trade dispute with China. European companies are concerned about losing affordable solar power.

"We are completely against the measures of the European Commission. This process might be in favor of a few European Module suppliers. But it will hurt the interests of many European module installers, EPC companies, and technology providers," said Miroslav Ivanov Toshkin, partner of solar enterprise, Bulgaria.

The European Photovoltaic Association says there should not be complexities to prevent free trade.

"The best of all, we will want to avoid any barriers to trade worldwide. I think it will be counter-productive if the process results the major distortions of the trade," said Murray Cameron, president of European PV Industry Association.