The recent turmoil in world-wide solar module manufacturing recalls a parallel situation in the early American Automotive Industry.
The Ford Motor Company introduced the Model T in 1908 at a price of $895. Due to part standardization and assembly line production, Ford was able to relentlessly cut costs year after year.
By 1923, Ford had reduced the price to $250, had put millions of Americans behind the wheel and was making over 50% of the cars in the world. The Model T was a successful design that had worked well for many years. In 1918 there were over 400 automobile manufactures in the US. By 1923 there were only 42.
Current photo voltaic manufacturing is following a similar pattern. With high demand driven by government incentives, large manufacturing capacity has been introduced. With economies of scale and competition for market share, the result has been massive oversupply and huge cost reduction of modules.
For 2012, there is approximately twice the production capacity as module demand. Crystalline Silicon, and specifically Chinese cSi modules, the Model T of solar, comprise over 50% of world production. While other approaches such as CIGS and CdTe thin films have been developed and commercialized, they cannot compete with proven cSi in today’s market. As a result, there have been many production reductions and recent business failures.
Back to the Model T…Everything was looking great for Ford in 1923. However by 1927, and even at a further reduced price to $200, the Model T had become hopelessly out of date. People wanted better comfort and features such as electrical starters. After over 15 million Model Ts were manufactured and sold, Model T production was halted. Ford never recaptured its dominant position.
Back to PV… Things will change. The advantages of solar energy are compelling. The current capacity/demand equation will change and become more balanced. At that point, there will be opportunities for something better. Better cost. Better efficiency. Better reliability. Better than the current Model T.
Whether you are manufacturing a Model T, a Tesla or cSi, thin film or concentrated PV, you need precision cleaning, sealing and adhesion to insure reliability. We can help.
As always, please contact me with questions or comments.
510 862 2581