Solar Crisis: Job Cuts and Price Wars Shake China's Energy Future
China's major solar firms have reduced their workforce by nearly one-third due to price wars, overcapacity, and decreasing demand. The solar industry, originally aimed at boosting economic growth, faces steeper challenges with continued financial losses and increased competition. Beijing is signaling potential interventions to stabilize the market.
China's leading solar companies have been forced to cut nearly a third of their workforce, according to company filings. The move comes as the industry, once championed by Beijing as a growth driver, struggles against plummeting prices and intensified competition.
These severe job reductions reveal the harsh impact of cutthroat price wars within China's industries, such as solar energy and electric vehicles, as they battle overcapacity and sluggish demand. While the world produces double the required solar panels annually, the majority are manufactured in China. Major companies like Longi Green Energy, Trina Solar, and Jinko Solar collectively laid off around 87,000 employees last year, a Reuters review found.
Beijing is expected to intervene to curb capacity, leading to significant fluctuations in polysilicon prices. Plans are rumored for creating an OPEC-like consortium to regulate prices, as the government aims to reduce outdated production capacity amidst economic challenges. This intervention is crucial, given the dire financial state of the solar sector, paralleling the real estate crisis.
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