Hanwha Q Cells' exit from Germany reflects weak European PV market

Source: pv magazine Deutschland

pv magazine: Hanwha Q Cells has announced plans to move production from Germany to more cost effective sites. What in your view are the reasons?

Stefan de Haan: The photovoltaic markets in Germany and Europe are still in a phase of consolidation. Installed capacity growth will increase again this year and in subsequent years, albeit at a lower level. New capacities that we saw in Germany and Europe in 2011 and 2012 will no longer be achieved in the foreseeable future. In addition, Hanwha Q CellsÂ’ production operation in Germany is relatively small, so no economies of scale can take effect. The company is, however, in direct competition with the major Chinese manufacturers. The announcement to shift production to more competitive locations is therefore quite understandable, especially as the wage factor is having a much bigger impact on the total cost of solar modules.

Hanwha Q Cells also stresses that the shift is not related to the merger with Hanwha SolarOne. Do you believe this?

Yes, I see no direct connection to the announcement of the merger of Hanwha Q Cells and Hanwha SolarOne. After all, Hanwha has allowed Q Cells to continue as an independent company after the acquisition. This worked well at first. Now the focus of the global photovoltaic market has shifted away but from Europe and towards Southeast Asia. Hanwha Q Cells is apparently responding now to this fact.

Does it make sense for Q Cells to continue further research and development activities in Germany without production operations?

It remains to be seen how long Hanwha Q CellsÂ’ research and development activities will remain in Germany. My guess is that researchers in Germany would have to achieve faster progress and success in the further development of technology than other Hanwha sites as well as the competition. If they succeed, Hanwha will surely hold on to its research and development in Germany. I think Hanwha will review this in two or three years and then decide.

What effect will the decision have on the Q Cells brand name in Germany?

I do not think the impact will be felt. Q Cells is of course a premium brand, but the products are not aimed at niche markets where ‘Made in Germany’ may be important. There are many Asian producers that are considered quality manufacturers in this country. With its German roots and German research and development, it should definitely be possible for Q Cells to maintain its reputation.

Translated by Edgar Meza.