China's Solar Industry Posts Three Consecutive Years of Losses, Sounding Alarm for Energy Storage and EV Sectors
Taylor Wilson
China's top solar firms have bled red for three consecutive years; Tongwei and LONGi still lead the losses, JinkoSolar has swung to a deficit, and industry insiders warn that energy storage and EVs risk the same shakeout if capacity keeps outrunning demand.
How deep are the losses at the top?
Tongwei and LONGi Green Energy remain the heaviest loss-makers, with no turnaround in sight after three years.
Aiko Solar (focused on BC-cell modules) saw its losses widen further; JinkoSolar swung from profit to loss in the first half.
This means → no technology bet has been enough to escape an industry-wide glut. Even the leaders are underwater.
How did overcapacity drag down the entire supply chain?
Years of aggressive expansion triggered a price war stretching from upstream polysilicon and wafers all the way to downstream modules, compressing margins across every link.
Upstream manufacturing prices have fallen below cash cost, trapping some firms in a cycle where every unit produced deepens the loss — forcing capacity cuts or shutdowns.
In plain terms = the product sells for less than it costs to make. The more you produce, the more you lose — until you shut the furnace.
Are different technology routes faring differently?
Mainstream TOPCon cells face the fiercest price war; profit margins have virtually vanished.
Heterojunction (HJT) and back-contact (BC) cells — two newer architectures — carry lighter debt loads and still have room to breathe.
Long-term survival, however, hinges on product competitiveness. A technology edge does not guarantee surviving a price war.
Some wafer makers narrowed their losses in the first half. This reflects that the first link to be squeezed may also be the first to find a floor.
Why are downstream projects and exports also buckling?
Cheaper modules should have helped solar-farm developers, but weaker solar irradiance in 2026 versus 2025, lower renewable settlement tariffs, and tighter grid-curtailment constraints combined to squeeze project returns.
China Railway Construction declared it will no longer invest in large solar projects; China Southern Power Grid halted new solar spending; Gree Electric Power slashed its solar exposure and shifted resources to wind and storage.
This means → when even state-owned enterprises and major power groups are retreating, the economics no longer justify new capital.
What hit the export side?
China's removal of export tax rebates raised costs for small and mid-sized exporters; yuan appreciation added further currency pressure.
Geopolitical tensions pushed up logistics costs and reduced shipping efficiency; JA Solar faces contractual claims after overseas delivery delays.
In plain terms = the domestic price war was hard enough. Now the export route is locked by tariffs, exchange rates, and logistics all at once.
Can energy storage and EVs dodge solar's lesson?
Authorities have introduced measures to curb destructive competition, and the market expects order to improve as weaker players exit.
But industry insiders warn: if capacity expansion in energy storage and EVs keeps outpacing demand — especially with overseas growth constrained by geopolitics and trade barriers — both sectors risk walking the same consolidation path as solar.
This signals something deeper — the cost of China's "expand first, consolidate later" playbook in clean-energy manufacturing is being repriced.
Content is for reference only, not financial advice.