Chinese solar panel maker Suntech flames out

[XemaSab]

Business was going gangbusters for solar module maker Suntech and its chief executive, Shi Zhengrong, just a few years ago. In 2007, Time magazine called him one of the “heroes of the environment.”

In 2008, CNN named Shi “China’s Sunshine Boy.” In 2009, Fortune anointed him “China’s new king of solar.” That year, New York Times columnist Thomas Friedman also cited Shi and Suntech as models of China’s green leap forward — which he called “the Sputnik of our day” and a spur for U.S. clean energy policy.

Now, however, the Chinese Sputnik has crashed to Earth, and the Sun King has been toppled. Buffeted by fierce global competition, faced with a worldwide manufacturing glut and hobbled by heavy debt, Suntech’s directors ousted Shi on March 4 and defaulted on $541 million worth of convertible bonds 10 days later. The following week, a Chinese court declared the company bankrupt after a petition from eight Chinese banks. On Wednesday, the company announced that its 2012 revenue had plunged 48 percent from the previous year.

Suntech — which in 2011 was the world’s biggest seller of silicon-based photovoltaic modules — was once valued at $13 billion on the New York Stock Exchange; it is worth less than 1 percent of that today. A news report that Warren Buffett might be eyeing all or part of Suntech lifted the battered share price more than 80 percent in one week, but acquiring Suntech could be a risky bet.

http://www.washingtonpost.com/business/economy/chinese-solar-panel-maker-flames-out/2013/05/03/9b7f29d6-ac2c-11e2-9493-2ff3bf26c4b4_story.html?hpid=z3

[RobertEarl]

1. Suntech has many enemies

Nukes, coal, big oil, etc. all hate the idea of what Suntech produces.....
""Electricity, too cheap to meter.""

Even here on DU there are those who sneakily express their hate for solar power. So no one can tell me that the big energy firms are not doing everything they can to cause the solar business harm.

"May the sun burn through them and make their cause into ash".
With no excess co2, please.

[patricia92243]

2. Bingo!

[Yo_Mama]

3. No, it has too many friends in the business!

The problem in solar right now is overcapacity. Suntech is not the only one losing money - it's just the one that owed a lot of money to foreign investors which could be scragged.

These companies are not covering their cost of production right now at current market prices, so they are all losing money. The reason current market prices are so low is that capacity to produce way outstrips demand, even at these prices.

http://www.reuters.com/article/2013/03/26/suntech-glut-idUSL3N0CG03820130326

[RobertEarl]

4. Right

You may call them friends, but the Big Energy companies are enemies of solar. BE is planning new nukes! They are building gas burners. Struggling to keep their coal plants burning.

If they were friends of solar they would be buying all the over-capacity and installing it. Never been cheaper. Never been easier. Never been a better time. What are they waiting for?

But maybe your idea of 'friends' is not the same as mine?

[NickB79]

5. "Friends" was a reference to other solar panel companies

IE there were so many companies making solar panels until a year or two ago that the market was flooded and the prices plummeted. For example, a small town that has a Wendy's, Burger King and McDonald's all open next to the local burger joint: too many "friends" making burgers for a limited market kills the local burger joint as the market is flooded with cheaper food.

If they were friends of solar they would be buying all the over-capacity and installing it. Never been cheaper. Never been easier. Never been a better time. What are they waiting for?

Because countries like the US and Germany have imposed tariffs to protect THEIR solar panel industries, which worked to raise the price of solar panels in those countries so domestic panel makers were more profitable. Thus, they aren't buying the cheap Chinese panels as much for installation because they are no longer that cheap when you tack on a 30% import tariff.

The truth is that politicians, be the US President Obama or German Chancellor Merkel, care more about domestic jobs than they do about tackling climate change.

[RobertEarl]

6. Indeed

The politicians sure don't seem to care much about climate change. Of course there is the idea of money to be made from climate change.

It is called "Disaster Capitalism" wherein many a profit is gained from responding to disaster. Lets see... Seawalls are one. Refugee resettlement is another. All kinds of infrastructure disasters will need $$.

As for solar BE hates it. It is already cutting into their profits and reversing their business plans. Not only that but people are using less electricity and BE's plans were all grow, baby grow.

Obama's Recovery Act put many a solar panel on buildings across the US. One I am familiar with used Suntech panels. Bought cheap and paid for by the gov. Funny circle going round, eh?

Whatever, the co2 emission cut over the years will be substantial.

[Yo_Mama]

7. Well, the problem is the huge growth in capacity in a very short time

China built up hugely, but so did Taiwan and the Indians are trying to get in with a tariff-protected scheme.

First the Chinese drove the Germans out of the business. Then they drove most of the US cos out of the business. Now they are driving themselves BK. They are still operating their plants.

Right now, the Taiwanese companies may be winning the race, because the Chinese companies have been borrowing money to cover every solar panel they sell for too long.

You cannot blame the conventional energy cos for this, and indeed many of them are trying to develop solar now.

[RobertEarl]

8. That's great news

Hadn't heard of many conventional energy cos trying to develop solar.

They should snap up these panels and get to fucking work, eh?

Just imagine if they had been trying to develop solar 10 years ago.
Imagine how many more coal plants could have been shutdown.

And I can damn well blame BE for not fucking having many more solar arrays. Don't even try to tell me again that I can't, cause they are to blame for not having mainly solar providing us electricity. Solar is only fifty fucking years old! Yo Mama.