LDK Needs More Than Hype to Brighten Its Bottom Line 赛维LDK：光靠作秀是不够的

It seems that LDK Solar (NYSE: LDK), one of the weaker players in China’s solar industry, is telling investors a new plant it’s just opened in Anhui province will help it significantly reduce costs by boosting its capacity (PRNewswire release) While increasing economies of scale does help to lower costs, good management is also an important element — something LDK is unlikely to get from this new opening. The timing of the announcement also seems rather suspicious, coming just days after Chinese media reported that Beijing would double its solar power targets in light of the Japanese nuclear disaster. (previous post) What I’m hinting at here, and not very subtly, is that it may take just a bit more than a new plant to help LDK fufill its promise to bring down costs significantly in the second quarter, as stated in the announcement.

Bottom line: LDK’s new plant in Anhui isn’t a substitute for good management.

在中国光电行业中排名算不上靠前的江西赛维LDK<LDK.N>近期声称，该公司在安徽刚刚开张的新工厂将帮助公司大幅扩张产能，从而降低成本。规模效应自然有助於降低成本，但良好的管理更重要，赛维对此可是只字未提。另外，赛维发布这一消息的时机也很可疑：中国媒体几天前刚刚报导说，受日本核危机影响，中国政府计划将太阳能发电目标翻番。我的意思是：如果赛维真想实现在第二季度大幅降低成本的许诺，仅靠建设一家新工厂是远远不够的。

一句话：赛维在安徽的新工厂代替不了良好的公司管理。