The Year of the Dragon is off to a dubious start for China’s alternate energy sector, with solar panel makers facing stiff resistance in both the US and Germany, 2 of the world’s biggest markets, and now wind power equipment makers coming under similar fire. The solar story in the US is actually an old one by now, following the launch of an investigation into unfair subsidies by Beijing for its solar panel makers last summer. (previous post) But what’s new on that front is that the US body that rules on such matters is likely to make its final decision soon, which will likely result in punitive tariffs that will send a chill through the solar energy market. A US group that helped to bring the original complaint has just put out a new analysis saying Chinese companies have been rushing to import their panels to the US in anticipation of a ruling against them, with imports up more than 100 percent since last July when the probe first began. (English announcement) Usually I’m a little skeptical about this kind of industry announcement, but in this case I wouldn’t be surprised if the numbers are actually relatively accurate, as Chinese producers like Suntech (NYSE: STP), Trina (NYSE: TSL) and Yingli (NYSE: YGE) certainly have reason to stockpile panels in the US to weather a coming storm that could see punitive tariffs remain for a year or more until the US and China settle their differences. Meantime, the solar panel makers are also facing new uncertainty in Germany, one of their other major markets, as that country said it plans to phase out many incentives to boost the installation of new solar capacity by 2017 and is already starting to make changes. (English article) The loss of 2 such major markets won’t be good for the industry in the short term, though it should hasten the introduction of new technologies that could boost efficiency and help the industry finally achieve its real goal of making a product that can survive on its own based on real economics rather than government subsidies. Meantime, the wind industry could soon be coming under similar pressure, as the US is also launching an investigation into unfair subsidies for Chinese wind tower makers. (English article) This action could hit another promising group of companies, though it should be less damaging as it focuses on makers of lower-tech towers as opposed to the more critical wind turbines that actually produce electricity. Still, this kind of trade war won’t help the industry’s development as a whole, and all parties would be much better served finding a less combative way to address the issue of state subsidies.
Bottom line: Looming US punitive tariffs and a winding down of German subsidies bode poorly for the battered solar industry in 2012, with at least 2 more years of pain likely.
Related postings 相关文章:
◙ Solar Matures With Foxconn Entry
◙ India Turns Up Heat on Solar With New Probe
◙ Beijing Boosts Solar In Latest Mixed Signal 中国扩张太阳能行业发展 解决与美争端立场混乱
The week-long Chinese New Year holiday is winding down in mostly quiet fashion, but a newly announced settlement for damages from a leaking oil well co-owned by CNOOC Ltd (HKEx: 883; NYSE: CEO) is making headlines by once again shining a spotlight on the shell games that big state-owned Chinese companies play. Under the new settlement, the publicly listed CNOOC basically escapes completely harmed in terms of monetary liability, as its state-run parent is taking all the financial responsibility for the mess, along with joint venture partner ConocoPhillips (NYSE: COP). (
A half year after spinning off its Weibo unit with an aim to earning profits from the wildly popular microblogging service, Sina (Nasdaq: SINA) is taking the first step to generating significant new revenues from the business by rolling out a new premium paid service. The strategy is certainly necessary if Sina ever wants to earn a profit from Weibo, and I even like the fact that it’s charging a very modest fee for the service, at least initially, which should help attract customers. But I’m still quite skeptical that the strategy will actually work, as it’s always hard to get people to pay for something they’ve grown accustomed to getting for free. Let’s backtrack a moment and look at the details of this latest development, which has Sina rolling out a service that will allow Weibo users to get the new premium service for the modest fee of 5 yuan a month or 50 yuan a year, translating to less than $1 per month. (
It’s official: the year for New York IPOs of Chinese firms has formally begun, and the first company out of the gate for 2012 is an unlikely candidate in the form of a rental car company with the rather boring name of China Auto. The company made its formal first public filing on Thursday in the United States for a New York initial public offering to raise up to $300 million, a respectable figure for a sector that has been dogged for nearly a year now by a series of accounting scandals that have hammered US-listed China stocks. (
It’s not often that I get to write about new initiatives by big foreign banks in China these days, so I’m taking this opportunity to take a quick look at a new and potentially intriguing deal involving American Express (NYSE: AXP) and Lianlian, a Chinese firm that helps mobile users add money to their accounts. Followers of big global banks like Citibank (NYSE: C), Bank of America (NYSE: BAC) and Royal Bank of Scotland (London: RBS) know that most of those names have spent the last few years trying to salvage their core operations at home, following the global financial crisis that saw most nearly driven to insolvency and only surviving with massive government bailouts. Against that backdrop, the only major activity we’ve seen from those banks in China in the last 3 years has been their sale of early stakes they took in China’s big 4 banks before they went public, with Bank of America and RBS both selling such stakes to raise cash. (
After a year of hyping its electric vehicle (EV) initiatives even as sales of its traditional cars plunged, BYD (HKEx: 1211; Shenzhen: 002594) is finally waking up to the reality that it needs to focus on the present as much as the future by trumpeting early success of some of its newest gasoline-powered vehicles. The company’s shares soared eightfold in 2009 after billionaire investor Warren Buffett bought a 10 percent stake, presumably betting on BYD’s big gamble on electric powered cars. But since then its fortunes have faded considerably, with the company’s sales of traditional cars tumbling about 15 percent last year due to lack of exciting new models even as the rest of the market eked out modest growth. In the process, BYD’s shares also took a beating, losing as much as three-quarters of their value last year before bouncing back a bit over the last 2 months. Some of that bounce-back is no doubt due to a broader year-end market rally, but perhaps some is also due to guarded optimism over early success that the company is trumpeting for recently launched SUV and high-end sedan models, where BYD is competing mostly with major foreign automakers. BYD says that its G6 high-end sedan launched 4 months ago zoomed to a strong but still relatively modest 5,100 units in December, and predicted 10,000 in monthly sales for the near future. (
Chinese banks are fast becoming a group of financial contradictions, rushing to implement the latest government financial directives even when doing so makes little or no commercial sense, once again spotlighting the big risk that investors take by buying into these companies. The latest twist in China’s ongoing banking saga has central planners suddenly loosening their grip on the nation’s lenders, which were under strict orders last year to curb their new loans to help Beijing cool an overheated economy. But following a GDP report earlier this week that saw growth slip to a 2 year low of 8.9 percent in the fourth quarter, central planners are deciding that perhaps banks should lend a little more to make sure the economy doesn’t cool too much. Separate media reports are saying that Beijing has suddenly decided that top banks, including names like ICBC (HKEx: 1389; Shanghai: 601398) and China Construction Bank (HKEx: 939; Shanghai: 601939), can increase their lending by up to 5 percent this quarter (
If Yahoo (Nasdaq: YHOO) was looking for a way to tell the world that its troubled relationship with Chinese e-commerce giant Alibaba Group was nearing an end, then the just-announced resignation of Yahoo co-founder Jerry Yang from all his posts at both companies looks like the perfect and very appropriate signal. Yang’s resignation means he will relinquish his positions as a director on the boards of both Yahoo and Alibaba, marking a quiet end to a stormy chapter in both companies’ history. (
China’s thirst for luxury goods is a well established fact, with sales soaring for big brands like Louis Vuitton and Burberry in recent years as Chinese consumers eagerly spend thousands of dollars for the latest status symbol. But the taste for luxury for more everyday items is far less established — a reality that Disney (NYSE: DIS) will have to contend with as it embarks on an ambitious plan to open up to 40 of its recently developed Disney-brand stores in China over the next 3 years. (
I want to start today with a silly story that shows that despite the recent confidence crisis for US-listed Chinese stocks, anyone with a good China story to tell can still earn a fast buck on Wall Street. The story I’m referring to involves battered video sharing site Ku6 Media (Nasdaq: KUTV), which has announced a tie-up with YouTube that will see the global giant start a new channel to bring Ku6’s content to a global audience. (
