Suntech, Canadian Solar in Latest PR Moves 尚德电力和Canadian Solar就西方倾销顾虑作出回应

By newsdoug on April 13, 2012

I’ll close out this week with a couple of items from the solar sector, where heavyweights Suntech (NYSE: STP) and Canadian Solar (Nasdaq: CSIQ) are continuing an ongoing public relations campaign to convince the west that their business is good for everyone and not just China. That campaign comes as growing signs emerge that the industry’s year-long downturn, which has sent most major players into the red, may finally be nearing an end and a new spring may soon arrive. China’s solar sector, which now produces more than half the world’s solar panels, has suffered a double blow over the past year, hit not only by a global supply glut but also by the threat of anti-dumping tariffs in both the US and Europe — the world’s 2 biggest markets. To combat the dumping claims, the sector has made repeated efforts over the last 6 months to show it doesn’t only sell its made-in-China products to the west, but that it can also help western economies by creating new jobs and business opportunities. The latest Suntech and Canadian Solar announcements appear to be part of that PR initiative. In one of the announcement’s Suntech said it has sold solar cells to produce 3.4 megawatts of electricity to Edwards Air Force Base in California, carefully pointing out that cells for the deal were produced at its factory in Arizona. (company announcement) On the other side of the Atlantic, meanwhile, Canadian Solar has just announced it is launching a qualified reseller agreement in Europe. (company announcement) This announcement also seems to be sending a similar message to Suntech’s, by pointing out that resellers in Europe can also make profits from selling Canadian Solar’s solar cells, thus bringing benefits to their local economies. While these announcements are clearly a public relations exercise, I think they also do reflect the very real fact that Suntech, Canadian Solar and their peers realize that they will have to do more to benefit the economies of the countries they sell to, and that they will also have to show the world that they don’t receive unfair subsidies from Beijing in the form of low interest loans, export tax rebates and cheap land. The US has already indicated it won’t punish the Chinese companies with high tariffs if they do more to wean themselves off support from Beijing and do more manufacturing in the US. (previous post) Europe is likely to take a similar approach, meaning the industry should avoid a trade war that would benefit nobody and hurt global development of this important alternate energy sector. Meantime, emerging signs are also appearing that the sector’s downturn has bottomed out, with Suntech’s chairman predicting earlier this month that many players will return to the black by the end of this year. (previous post) If things keep going smoothly on both the trade and pricing fronts, look for a strong rebound from this battered sector starting in the second half of the year, including nice upside potential for solar stocks.

Bottom line: The latest PR moves by Suntech and Canadian Solar show the sector is responding to western dumping concerns, as dangers of a trade war continue to ebb.

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