October 22, 2007 – A reported deal between mainland Chinese solar module maker Suntech Power Holdings Co. and Taiwan firm Sino-American Silicon Products Inc. exemplifies a model of cooperation between front- and back-end providers in the photovoltaic industry between the two regions, notes a story in the Taiwan Economic News.
The deal, reportedly worth in the “hundreds of millions” of US dollars, involves reserving some of Sino’s crystal growing capacity, and the firm is hiking output to 130MW by year’s end (six months sooner than anticipated) to accommodate the order, the paper notes. The deal will increase the company’s monthly PV revenue to nearly $30M. Sino-American’s PV gross margins are already about 35%, the best among its PV peers in Taiwan, and 80% of its capacity is sold out.
Suntech already has “tons of orders” and urgently needs the crystal-growth capacity, according to the paper. The firm signed a multiyear, multibillion deal with MEMC last summer, and has a ~$680M polycrystalline silicon supply deal with US firm Hoku — all materials that need to be processed by other manufacturers like Sino-American before incorporation into Suntech’s modules, the paper notes.