San Francisco, CA--Solarbuzz, a market research business focused on solar energy and the photovoltaic (PV) industries and part of the NPD Group, says that PV equipment spending for crystalline silicon (c-Si) ingot-to-module and thin-film panels is forecast to decline sharply in 2012 to $7.6 billion, down 47% year-over-year from a record level of $14.2 billion in 2011. Also according to the latest Solarbuzz PV Equipment Quarterly report, the decline in equipment spending--which includes lasers for PV materials processing--will impact second-half 2011 PV equipment revenues and result in lower corporate guidance for 2012. Solarbuzz says that this collapse in equipment spending is due to ambitious c-Si cell, module, and thin-film capacity expansions committed during 2010 and the first half of 2011 by tier 2 and tier 3 PV manufacturers.
Q2 2011 PV equipment spending reached $3.6 billion, declining 3% quarter-over-quarter and representing the first negative growth rate for PV equipment spending since Q2 2009. According to Finlay Colville, senior analyst at Solarbuzz, "Strong double-digit bookings and revenue growth through 2010 created a misleading picture for PV equipment suppliers. This was caused in part by aggressive expansion plans of second-tier c-Si manufacturers, and by the quantity of new thin-film fabs that were financed through the recent thin-film investment cycle. An artificial peak in equipment spending was created during 2010 and 2011, providing a short-term pull on equipment that was out-of-sync with the long-term requirements of the industry."
Expansions across all tier categories will provide 51 GW and 66 GW of annualized capacity during 2011 and 2012, accumulated from over 300 manufacturers. However, by filtering out the manufacturing capacity that is both cost-competitive and market-leading, the true significance of these capacity levels becomes apparent. Tier 1 cell manufacturers will account for 24 GW and 34 GW of capacity in 2011 and 2012, more than sufficient to meet global demand over this time period.
"Tool suppliers will increasingly focus on securing preferred-supplier status with tier 1 manufacturers," added Colville. "Additionally, competition will intensify ahead of the next spending upturn as suppliers from adjacent market segments (e.g. semiconductor and display) exploit the opportunity to enter the PV equipment supply-chain."
SOURCE: Solarbuzz; www.solarbuzz.com/our-research/recent-findings/pv-equipment-spending-fall-nearly-half-2012
