Some China-based PV module makers have reduced output, while others will do so due to high inventory levels, according to industry sources.
Among the China-based PV module makers, second- and third-tier ones in particular heavily rely on domestic demand, the sources said.
Although China’s National Energy Administration has set target total installation capacity of 18.1GWp for PV power-generating stations to be established in 2016, local governments have not yet made administrative preparations to support the goal, and therefore domestic demand has not emerged, the sources noted.
As a result, second- and third-tier PV module makers have been forced to decrease production substantially, with capacity utilization mostly dropping to below 50%, the sources indicated.
First-tier PV module makers rely more on overseas markets and the demand is considerably weak currently, the sources said. Consequently, their inventories have risen to as high as a 3-month level, and thus they have lowered or plan to lower capacity utilization to 60-70% to reduce output, the sources indicated.