For example, JinkoSolar has been busy increasing its investments in upstream manufacturing including a 20GW cell-making factory in Chuxiong, a move that would help it compete with its rivals in cell manufacturing space. This is one of the biggest and the most significant investments the company has made.
This giant factory would primarily serve the company in its vertical integration model as it sees a surge in demand for its solar panels, particularly Tiger Pro series in the pandemic era.
While the actual push to build this factory is ripe with supply chain constraint, it may turn out to be one of the better strategic moves as the company deals with multiple uncertainties in the future. The biggest uncertainty we see on the horizon is supply chain resilience. For instance, almost all panel manufacturers have been scaling back bifacial production in response to glass shortages since Q3 last year. JinkoSolar has been on high alert over this risk and is making a concentrated move to tie much closer with its key vendors to secure critical material supply, including silicon, glass, frame, silver paste, etc.
There is another important point we need to consider about new factory being constructed now. The demand for high efficient panels is growing exponentially and we are already seeing shortages impacting the whole industry last year since demand outstripped supply. Given that case, JinkoSolar’s R&D result and innovative technology cannot be adopted by contracted vendor who make its own process the priority. So once the factory operations, the company could exert more control over its cost and go-to-market pace of new products.
JinkoSolar will make Tiger Pro series panel using its own high efficient cells until other OEMs can create cell in the same efficiency range. It could be critical for keeping intact the flow of demanded high performance products to the global customers and keep JinkoSolar’s growth moving forward.