China has ordered the solar sector to rein in overcapacity and cut-throat pricing as the biggest manufacturers suffer billions of dollars in losses.
Six of the largest Chinese cell and panel makers saw their combined first-half losses double to Rmb20.2bn ($2.8bn) from a year earlier, with all but one reporting widening losses, according to financial information provider Wind. The losses compare with record profits in 2022 and 2023.
Solar is one of the industries at the heart of Beijing’s concerns about “involution”, which refers to excess production fuelling a race to the bottom in prices. It has added to China’s deflationary pressures, a key economic problem for President Xi Jinping, and stoked tensions with trading partners as companies turn to exporting their products.