Analysts at IHS have revealed that the Chinese PV inverter market expanded by 18% in 2014, with shipments for the year pushing the market to a cumulative 13.3 GW of alternate current.
However, over that same period, revenues fell by 6% as price declines across the inverter industry continued. Such was the ferocity of the price pressure that many smaller suppliers previously operating in Chinas competitive inverter market have folded, while the largest-two suppliers the well established Sungrow and the relative newcomer Huawei increased their market share considerably.
IHS says that Sungrow has been able to narrowly cling on to its position as the largest Chinese inverter supplier to the domestic market, but telecommunications giant Huawei which only began producing inverters at scale in 2013 is closing.
Together, the two companies accounted for 48% of all inverter revenue in China in 2014, and both have made an appearance in the top ten largest suppliers globally the first time that two companies from China have broken through on to that list, says IHS.
"The PV inverter product mix has begun to shift as string inverters made huge gains in 2014, largely owing to Huaweis aggressive promotional and marketing campaigns," said IHS Technology senior analyst, Frank Xie. "There is also a narrowing price gap between mainstream central inverters and string inverters that are increasingly used in large commercial- and utility-scale PV systems in China."
Xie added that despite losing share, central inverters will continue to shape the Chinese solar PV landscape between 2015 and 2019.
Sungrow is estimated to have around 35% market share in China, and although many smaller domestic companies have been squeezed out, IHS does not expect that space to be filled by international suppliers. The IHS PV Inverter Market in China report states that foreign companies have found conditions tough in China, where there is a strong preference for local brands, highly competitive pricing, complex business conditions and long credit terms.