Since the third quarter of 2013, several photovoltaic (PV) module manufacturers, including Jinko Energy, have started to return to profitability. From Jinko Energy’s perspective, achieving profitability in such a challenging environment was no easy task. It required significant effort, strategic adjustments, and resilience. At the same time, among the PV companies that managed to turn a profit, some have announced new capacity expansion plans. This has led certain analysts to predict that the industry may still face overcapacity in 2014, with supply outpacing demand.
However, the current methods of industry growth are primarily focused on outsourcing, plant leasing, and mergers and acquisitions—rather than building new production facilities. As a result, there hasn’t been a substantial increase in overall capacity. Meanwhile, industry demand has begun to recover and is growing steadily. It is estimated that global installed PV capacity will reach around 40 GW in 2014. China, in particular, played a major role, with its newly installed capacity reaching 8.5 to 9 GW in 2013, making it the world’s largest market. In 2014, China is expected to maintain this momentum, increasing its solar installation target by about 20% to 12 GW.
The benefits of increased demand are clear, but many companies have learned from the previous round of aggressive capacity expansion and price drops. As a result, they are more cautious when considering new projects and are unlikely to rush into another overexpansion. This suggests that supply-side imbalances are unlikely to repeat themselves in 2014. Instead, the industry is expected to move toward a more balanced supply-demand relationship. Jinko Energy itself achieved profitability during the second and third quarters of 2013, which highlights the positive trend.
In a market where supply and demand are becoming more balanced, customers are placing greater emphasis on brand reputation, product quality, system reliability, and long-term power generation performance. As a result, high-quality orders are increasingly flowing to top-tier brands. First-line manufacturers continue to expand their capacities, while second-tier players maintain stability, and third-tier companies see their production capacities shrink. This shift not only ensures steady demand for the industry but also helps eliminate outdated and inefficient production, which is crucial for long-term sustainability.
Looking at the global market, the growth of PV demand in 2013 was largely driven by three major markets: China, the U.S., and Japan. For 2014, the Japanese market may face uncertainty due to policy changes, but the U.S. and China are expected to remain strong. China's 2014 solar installation target is set at 12 GW, supported by favorable domestic policies.
The domestic market has benefited significantly from strong government support, leading to rapid development of photovoltaic power stations. The annual growth rate is expected to remain around 20%, with stable revenue and further expansion in scale. The power station business is now starting to make a meaningful contribution to the industry.
2013 marked a turning point for China’s distributed PV market. Although there were ongoing policy adjustments and experiments, distributed power plants remained attractive as long as subsidies were timely, industrial parks remained stable, and electricity tariffs were in place.
At the same time, it’s important to note that end-users are setting higher standards for power station quality. Their expectations for consistent power generation and system stability are rising. While many manufacturing companies are entering the downstream segment, the design, construction, operation, and investment in power plants are fundamentally different from component manufacturing. These areas require distinct skills, technologies, and management approaches. Simply following trends may not be effective; instead, companies must develop these capabilities based on their long-term strategies and practical strengths.
Innovation and sustainable growth have been key factors in Jinko Energy’s early profitability. Looking ahead, the company remains optimistic about future prospects, even amid challenges.
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