Big in Japan

First, please can you explain how the division Marubeni Techno-Systems differs from what we generally know about Marubeni?

Marubeni is famous as an IPP player in solar. While we as Marubeni Techno-Systems focus just on the trading. So for Huawei, we are a distributor of their products. Our USP is our background in the machinery industry.

This division has unique properties because we have different faces, as an IPP player, and as a distributor for modules and power conditioners. Besides that, we have another face as an assembly machinery supplier, especially to the large module manufacturers. We still provide production equipment to these tier-1 companies.

There are five groups within Marubeni, and each group has a different business model. In terms of PV industries, each has its own business model and functions upstream and downstream in the PV supply chain.  For example, The Power Project Group is purely focused on power supply, and does not specify any particular source – solar, conventional, anything that is suitable for the market, and that is demanded in each region.  One example is the Mega Solar project, which is well known in Saudi Arabia. Marubeni Techno-Systems is 100% owned by Marubeni. We cover a broad cross-section of the PV supply chain- not only assembly machinery but also backsheet, glass etc- which are important key points for module quality.

In the early 2000s, we started to export Japanese PV modules outside of Japan. This is when we saw Europe’s PV market begin to grow. We delivered PV modules we were involved in making into Europe. The yen was weak against the euro at that time, which made it hard for us. But luckily this was also when the Japanese market began to boom.

We also make and have expertise in module production lines, as well as module supply and racking system supply – we have contacts and logistics here. This is our USP: Rather than building vast plants, we began with smaller plants, built and supplied by us, monitored by us, and we have learned from that.

How did the partnership come about? For how long has Marubeni Techno-Systems worked together with Huawei?

Back in 2014, we knew Huawei as a string inverter supplier. At that time, we still believed that a centralized [inverter] solution is necessary. We hesitated to work with them at the time. It was not until 2016 that we began to partner with Huawei. Marubeni Techno-Systems’ trade partner is first and foremost Trina Solar. We began in solar at almost the same time, in 1997, communicating with CEO Jifan Gao. They used to be our customer, but now they are  our important partners. We still provide production machinery to them, while we buy their modules to sell into the Japanese market.

Trina Solar has a high end production line, and recently it has been improving the line by installing new equipment, and it is growing at a far faster rate than before.

In 2013, the boom in Japan had already started. Many players jumped into the market at a time when Japanese module brands were strong. Chinese firms still had a weaker reputation, even if the quality was good. So Marubeni decided to work with Trina, and still today we purchase modules from their dedicated factory and lines under Trina’s QC regulation. This is Marubeni‘s expertise.

Trina were always cooperative and with a view on growth and quality, not just profit. They gave us confidence selling Trina modules into the market with the Marubeni’s eyes.

So knowing about Marubeni’s unique sales scheme and strong presence in the market, Huawei came again to Marubeni, and gave a presentation about their string inverter. At that point, our industrial machine department was designing a new solar plant. We always naturally opted for central inverters and Japanese brands, because of our reliance on EPCs who were cautiously conservative.

But then we went to visit Huawei’s factory to witness and discuss the inverter. This visit was the turning point for us. We started to evaluate an entire string inverter – cost, output, installation, maintenance – all evaluations possible. It was like a scoring or ranking system, and Huawei came out best, in comparison to a lot of Chinese, Taiwanese, and Japanese inverters. For 30 kW to 40 kW inverters, they’re hard to find from Japanese suppliers at that time. This size was ideal for our projects, and we were impressed.

Huawei were very new, with little in terms of field data to assess. What type of assessment and testing were you able to do when making your decision, particularly in terms of postinstallation O&M and service?

Well, service is very important. But the funny thing is, Huawei’s inverters don’t need service – they changed the game! That was really shocking. Honestly, I was taken aback, to slowly realize that Japanese manufacturing expertise cannot beat Huawei. Quality control is high class, and they know Japanese standards and regulations, they thoroughly study and respect these important key factors.

Japan is famously proud of its technology and ways of doing business – and rightly so. When it comes to making things, we Japanese are proud to see ourselves as number one. Based on this viewpoint and measurable success, we went to Huawei to organize and consult with them, and without knowing the history or country of origin of the inverters, we saw the technology and how it requires no maintenance, is competitive on price, and we could not help but be impressed and happy with the decision to partner with Huawei.

We had operated several mega solar sites, and every week we had a report of what the electrical output was, the performance, etc… The reports always indicated central power conditioners requiring a change of fuse, cleaning of the filter etc… so we found that the maintenance cost for power conditioners is very sensitive, even though its cost is not huge.

We then thought that Huawei inverters could help us to remove those costs, because of their five-year warranty program, which can extend to a total of 20 years. And also, the message I wanted to instill throughout our team was: “Don’t just rely on Japanese products, lets go with Huawei.”

Therefore, my message to the clients was: Although Huawei is new to the market, their products can help to improve the performance of your projects, from technical as well as commercial aspects. That is why initially we began by explaining the general advantage of string over central, because the market at that time was still skeptical.

Nowadays, this trend is well recognized. So our message has evolved. We chose Huawei as a partner and began distribution work. Now, are proud to supply high quality products: Trina Solar modules and Huawei inverters.

When you were approached by Huawei, what else beyond the production quality and performance convinced you to partner with them? How much of an impact did Huawei’s digitization capabilities have on your decision?

Their development speed was impressive. The reason why the industrial machinery division is strong is that the market always adapts. Yesterday’s product is not high end today. So we have to stay on the pulse. With Huawei, we saw how 10% of their annual turnover goes towards R&D – it’s nice to know, sure. But the reality is that they develop new systems and products including storage, an electric vehicle charger, and residential applications. And this gives us the confidence that Huawei shares those same values, and maybe Marubeni can support them on their journey. For the next-gen business we thought we can be their partner. They don’t need our support in the mobile phone space of course – we are just a customer – but for power electronics, we see opportunities to work together.

Are your clients who now use Huawei products also sharing such enthusiasm?

It was difficult to penetrate the market, because Japanese players dominated. The door for the newcomer is a bit hard to open, because every decision by the management reflects what the Japanese manufacturer said. All regulation stems from here. So as a user they hesitated, and questioned it. We decided we would be a fast initiator, and lead by example.

The message I’m getting is that quality, transparency, and speed is important to you.

Huawei’s new larger inverters come quickly, and their intention is always to pursue new markets, and they do this because they keep a close eye on market trends. That gives us confidence that they look for and know what’s going on in the market; and prepare development items to fit this. As a distributor, this makes our job very easy.

Now you have field data of Huawei inverters, so are you finding that your initial impressions are being proved correct?

Our first customer bought 10 MW of Huawei inverters – built in 500 kW blocks. They feed back entire data and they indicate above-expectation performance throughout. We have sold many inverters in the market, and this is good. We haven’t yet had to respond to any emergencies or problems with Huawei, so we cannot assess the level of their service yet – because there have been no failures so far!