Massive production overcapacity in China’s wind power industry will force Chinese wind turbine manufacturers to focus on the overseas market over the next five years, according to new research by market research firm CCM.
China has installed wind turbines at an astonishing rate in recent years, with the country’s total installed wind power capacity rising at a CAGR of 58% from 2007-2013, but the production capacity of Chinese wind turbine manufacturers has grown even more quickly and is now at least double the country’s demand for new turbines.
Chinese manufacturers are now capable of producing 40 GW worth of turbines annually, while the Chinese government’s target is to install only 20 GW of new capacity per year between 2015 and 2020, according to CCM’s research.
Michelle Li, CCM’s energy market analyst, commented: “Severe overcapacity in China’s wind power industry is likely to lead to a large-scale market consolidation over the next few years, and many turbine manufacturers will be bought out or go out of business.
“With domestic demand likely to remain flat for the foreseeable future, companies that are able to secure contracts overseas could hold a key advantage over their rivals.”
Exports accounted for just 4.3% of Chinese turbine manufacturers’ total sales volume in 2013, but this figure is rising rapidly. Exports more than tripled between 2011 and 2013, whereas domestic demand fell slightly during that period.
Several companies are already focusing on exports, with Sany Group and Sinovel generating 30% and 14% of their wind turbine sales overseas respectively in 2013. Goldwind has also had great success obtaining contracts outside China – in 2013, the company exported 361 MW worth of turbines, more than all the other Chinese manufacturers combined.
Moreover, Li believes that there is much more potential in the export market: “What stands out in the export data is, firstly, the huge diversity of countries interested in buying Chinese-made turbines. The top ten buyers include large economies such as the US, Australia, and Italy, but also Panama, Romania, and Ethiopia.
“However, the absences from this list are also noticeable. For example, as of 2013 China had only exported turbines to 27 countries in total, and only one of these nations – Thailand – was a member of ASEAN. Chinese manufacturers will look to expand their presence in this market considerably over the next five years.”
These findings are taken from Market and Future Prospects of Renewable Energies in China, a new report on China’s renewable energy market by CCM. The report provides comprehensive data, forecasts, and investing advice on a number of renewable energy markets, including:
- Solar – PV (grid-connected and distributed), and solar heat
- Wind – onshore and offshore
- Hydro
- Biomass – power generation, solid biofuels, liquid biofuels, and biogas
- Geothermal
- Ocean
A free sample of the report can be downloaded here.
For more information about CCM and our coverage of China’s renewable energy market, please visit www.cnchemicals.com, or get in touch with us directly by emailing econtact@cnchemicals.com or calling +86-20-37616606.
Accompanying data can be provided on request.
For more information, please contact:
Dominic Morgan
PR & Marketing Executive, CCM
T: +86 13622236593
E: dominic.morgan@cnchemicals.com
About CCM:
CCM is the leading provider of business intelligence on China’s agricultural, food, biotechnology, chemicals, energy, and pharmaceutical markets. Based in Guangzhou, China, CCM provides a host of international clients, including Shell, Coca-Cola, ExxonMobil, DuPont, Syngenta, Bayer, Monsanto, and Tate & Lyle, with a variety of intelligence solutions, from market data, industry e-news services and market research reports, to company profiles and consulting solutions. CCM is a brand of Kcomber Inc.
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