The big guns are getting into the solar game..spells good news for solar installers..not for others…

Foxconn is getting into the solar module making game.

The maker of iPhones is used to working on razor-thin margins and will change the game for the industry. While most module makers are used to making margins north of 20%, the entry of mass market players like Foxconn will drive costs down, take out inefficient module makers and encourage installation by a further reduction in market pricing.

Add into the mix recent announcements by Oerlikon, GE and Panasonic, all targeting well under $1 cost per watt for finished modules, it would seem to mean that the days of solar modules costing over $1 are over. The addition of 800MW of capacity by GE and Panasonic alone will ode badly for small to midlevel players who have taken a “commodity” approach to the business, yet it will feed an industry into deeper market penetration as the cost of solar approaches, and in some markets beats, the cost of other grid-tied utility rates.

2012 is certainly looking to be a game changer for the market. Many in 2011 had said that they expected pricing to firm up given the fact that many players have closed and more will close, however I do not think that we’ll see that happening. Despite solar wafer makers attempts to negotiate higher prices, they have not been successful so far. What we will see is a firming of pricing around the $0.75 (thin film) to $0.90 (crystalline) marks and this until further reductions in costs are brought by firms such as Foxconn. They are possibly the first contract manufacturer to get into the game in a big way, yet they won’t be the last.



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