Sharp mulls China solar cell market entry

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Under its new Taiwanese ownership, Sharp’s solar division has begun exploring international solar cell supply opportunities, and recently revealed that it is assessing the markets of the Philippines, Indonesia, Mongolia and across Europe.

This week, as reported by the Nikkei, Sharp has also begun conducting market research into the viability of supplying into China – the world’s largest solar market and a traditionally difficult sell for the higher-cost components Sharp produces.

With Hon Hai Precision Industry now the parent company, however, such bold steps are likely to become more commonplace. Its subsidiary, Foxconn Technology Group, has long seen the development of Chinese sales network as a viable target, and with Sharp’s strong brand already securing supply contracts for large solar projects in nearby Indonesia and the Philippines, there is hope that similar strides can be made in China.

Earlier this year it was rumored that Foxconn may seek to unload the solar cell business following its Sharp takeover bid, but those plans have been shelved and now the emphasis appears to be one of globalization under the internationally recognized Sharp brand.

Xiaoting Wang, solar technology specialist based in Bloomberg New Energy Finance’s (BNEF) Hong Kong office, told pv magazine that Foxconn’s plan to lean on China in light of shrinking domestic demand is somewhat faulty logic.

"Sharp’s hope for the Chinese market to provide respite from the downturn in Japan’s solar market is not likely to come through, because the Chinese market is already oversupplied by Chinese manufacturers," Wang said. BNEF says that China has already experienced a 2016 installation peak, and could see new build solar fall by around 20% in 2017.

According to the Nikkei, Sharp is also aiming to step up its marketing of white goods in China, marking a double-pronged approach. "Sharp’s white goods business model is only viable in markets where customers are willing to pay a premium for that specific brand name," Wang explained.

"That business model had served Sharp in Japan’s rooftop PV market, but it is unlikely to be effective in the case of China’s PV market, or, for that matter, most of the rest of the world going forward as PV panels are treated more and more as an indistinguishable commodity."