Report: Solar cell JV “risky” for Sanyo

Oct. 2, 2008 – Sanyo Electric’s proposed JV with Nippon Oil to make next-generation solar cells is a risky venture, according to local Japanese media, which claims that despite its solid technology the company is still in a rebuilding phase and battling aggressive competitors, while struggling to balance investment needs across its landscape.

The proposed JV would be established in the beginning of the next fiscal year (April 2009), with operations starting in the following year, marrying Sanyo’s thin-film solar cell technology currently out of its Gifu plant with Nippon Oil’s production technology and materials development know-how. Sanyo was the first to commercialize amorphous solar cells in 1980, and its thin-film technology has long been used in devices including calculators and watches, notes the Nikkei Business Daily. An experimental HIT solar cell, a c-Si/thin-film hybrid, is said to achieve 22.3% efficiency, and the company hopes to achieve 12% efficiency in its latest thin-film cells, vs. 5%-8% in conventional technologies.

But the paper notes that Sanyo is facing intense competition not only domestically but also on a global scale, ranking seventh worldwide (third domestically) despite its manufacturing, technology development, and materials purchasing efforts. Sharp, for instance, expects to shortly begin shipping thin-film cells from its Katsuragi plant, while planning production at a new plant in Sakai next year. Equipment suppliers are also working to boost energy-conversion efficiency, and are aggressively selling to customers in China and Taiwan; “soon, anyone will be able to mass-produce solar panels without special expertise,” the paper claims. “Given such developments, it is unclear how long Sanyo can hold its technological edge.”

Sanyo is in the middle of a three-year, ¥70B investment in c-Si solar cells but also needs to fund its thin-film investments as well, while other parts of the company struggle. The firm recently decided to shut down a chip plant in Korea, as well as six sales offices in Hong Kong and elsewhere, the Nikkei notes. Sharing the JV’s anticipated “tens of billions of yen” burden with Nippon Oil will ensure “financial stamina […] necessary to survive,” according to Sanyo VP Kazuhiko Surata, quoted by the paper. But, it also points out that “this arrangement carries the risk of Sanyo losing leadership of the overall operation if it follows Nippon Oil’s lead in investment.” Faced with heavy restructuring costs, the company “cannot afford to focus investment on a single operation.”


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