One year ago, you told pv magazine that your vision for 2018 would be to bring digitalization to every person, family, and organization to build a fully connected, intelligent world. What progress has Huawei made to this end over the last year?
The vision of Huawei is to bring digital to every person, home, and organization for a fully connected, intelligent world. We set up and repeat this vision during past years and now by including our inverter sector, the entire Huawei company is heading towards this future. The vision includes three levels or stages. All things sensed, all things connected, and all things intelligent. First, we try to modify and make things sensible, which means data and information can be sensed and collected from the environment. Then we use connection means, including wired or wireless, especially 5G technology, to connect all of them into the network, and onto the cloud. In October 2018, Huawei announced the Full Stack All Scenario AI Solution, and we now provide the AI functions and solutions from bottom chip level to industrial level.
Our target with AI is to set up a platform on which our partners can provide specific and customized AI applications for end users. We just provide the basic infrastructure service for AI developers, just like the power grid: You use electricity, but you don’t need to know where and how the electricity is generated.
We follow the general Huawei company strategy for our Smart PV Business Unit. Our latest FusionSolar Smart PV Solution is pre-equipped with AI, cloud computing, and big data technologies. These features can help our customers to achieve higher yields with optimal LCOE, locate problems quicker, and achieve better performance. With Huawei’s FusionSolar platform, we already help customers to operate and maintain more than 30 GW of solar PV projects. And we will continue in our devotion to this sector.
Are there regulatory burdens to overcome in certain markets?
We know people are curious about this question of Huawei, especially under the current China-U.S. trade war, in which Huawei was named by the U.S. several times. Honestly speaking, we have not experienced such kind of obstacles in Europe when marketing our inverter products. We have very good relationships and cooperation with our European customers, and we will continue to serve them and follow our customer centric principle.
The inverter market segment is very dynamic. What are the big trends of the inverter landscape this year?
Because of the spread and popularity of bifacial modules, which we believe is an obvious market trend, it will be important in the future to better connect inverters with high-efficiency bifacial modules, tracker support structure, and multi-MPPT. I think this will influence the investment and the future of inverters greatly. If this is correct, the future prospect of large centralized inverters is dim.
We have worked and cooperated with several key partners including tracker support structure providers, module suppliers, and EPCs to observe the actual performance. Of course, we have identified some problems that need to be resolved. We believe there is still a process before this becomes mature, and we are working with our partners to push it.
For four years, Huawei has continuously ranked number one in inverter shipments. What is key to Huawei’s success?
First, it is because of the platform of Huawei Company. The platform attracted talented people, and talented people make the business successful. Second, it is because of the brand of Huawei. For a product that needs 25 years of service life, the manufacturer should survive that long to serve its customers. And the core factor is that we provide good products and solutions.
At Huawei, our smart employees have devoted themselves to this inverter product, bringing their experience and quality control expertise from ICT products with higher requirements. We have found that our customers, especially from Japan and Europe, are most concerned with stability, which is exactly what we are good at – based on the system of Huawei.
What will be the main themes for Huawei’s marketing of inverters in 2019? And what does Huawei predict for the market in the future?
In 2019, our market focus is still on products and solutions for lowering LCOE. We face challenges from our competitors and the market. We are concerned with market trends, but no matter how markets change, we will focus on providing the lowest LCOE in the inverter sector for our customers. We believe this is the key factor that makes Huawei’s inverter irreplaceable.
We shipped over 90 GW of FusionSolar globally through December 2018. Our overseas shipments recorded at 48% of total in 2018, with 52% domestic. With the rapid growth of overseas markets, we estimate the growth could be 100% over 2018 this year. In Q1, we had a 140% increase in our overseas sales. In 2019, overseas shipments may increase to 70% of our total business.
In the future, we will try to control the number of customers which we directly do business with to less than 100 and establish a distributor system to handle all other customers. This means a shift from previous direct sales to a distributor system, and we’ll cut our costs in sales and marketing.
People in the industry are watching closely as China’s next policy move is expected. How do you think your domestic market will play out in 2019?
Yes, lots of people including myself are watching and waiting for the policy. From the news released so far, personally I believe it will be a positive policy for China’s PV industry.
First, due to the international rules which you will face outside of China. Second, the new policy will benefit those manufacturers that produce at high quality and eliminate low quality products. A really good policy will drive the industry to grow even stronger. We are working to understand the policy to try and figure out how to match the policy to our product, human resources, marketing, and even structure.
Do you think Huawei has met or is going to meet some kind of bottleneck in growth?
Presently, solar PV accounts for around two percent of total power generation globally. I think in future solar with storage will very probably be the most promising renewable energy. If I am right, the total installation capacity will be tremendous compared to its current size. The market is just at its beginning stage. Actually, all the major energy giants including State Power Investment Corporation (SPIC), Huaneng Power, Électricité de France (EDF), and others are just getting started in their transformation from traditional power to renewable energy.
Because of declining costs, solar PV energy is now the cheapest power source in many places. This will terminate investment in traditional energy. The future market of solar PV will be ten or even a hundred times its current size.
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