Research: Module manufacturers must focus on increasing revenues

Share

According to IMS Research, although megawatt (MW) shipments of modules have grown at an average of 60 percent over the past two years, industry revenues have only grown by only 13 percent. The company says that as the industry prepares to enter a period of “softening demand” and “decreasing prices”, suppliers will need to concentrate on growing revenues and profits, instead of just focusing on “who’s shipping the most MWs”.

It goes on to say that module shipments are forecast to grow by over 65 percent to more than 16 gigawatts (GWs) this year. However, it adds that reductions in incentive schemes in Germany, as well as a correction of the pulled-forward demand seen this year, are likely to bring about a slowdown in growth.

Consequently, IMS Research predicts that shipments will increase by less than 20 percent in 2011. The slowing of shipment growth, combined with declining prices, it says, means that PV module revenues may in fact decline next year, depending on how severe the slowdown is in the first half of the year.

“The PV industry is currently in a period of very high growth, driven by robust demand from almost every area of the market,” commented Sam Wilkinson, PV Research Analyst at IMS Research. “However, the industry has a dangerous tendency to only focus on MWs and GWs or capacity and shipments, rather than revenues and margins.

“Price declines driven by reductions in incentives and increasingly competitive market conditions mean that whilst the module market may continue to increase in terms of volume, the outlook is quite different when measured in terms of revenues.”

In fact, it says that 2011 is not the only time that the market has performed in this way. 2009, it explains, saw module shipments grow quickly in the second half of the year and overall MW shipments increased by over 50 percent.

However, rapid price declines throughout a large part of the year meant that industry revenues in fact declined. Whilst the PV market may seem on the surface to be a booming market, a closer look at the real bottom line makes PV module market growth look far less impressive, it concludes.

This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: editors@pv-magazine.com.

Popular content

Elastocalorics could replace heat pumps, air conditioning systems

16 July 2024 Elastocalorics have the potential to replace current air conditioning and heating systems, offering significant energy savings when paired with techno...

Share

Leave a Reply

Please be mindful of our community standards.

Your email address will not be published. Required fields are marked *

By submitting this form you agree to pv magazine using your data for the purposes of publishing your comment.

Your personal data will only be disclosed or otherwise transmitted to third parties for the purposes of spam filtering or if this is necessary for technical maintenance of the website. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so.

You may revoke this consent at any time with effect for the future, in which case your personal data will be deleted immediately. Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled.

Further information on data privacy can be found in our Data Protection Policy.