China-based solar equipment manufacturers Yingli Green Energy Hold. Co. Ltd. (ADR)(NYSE:YGE) and JA Solar Holdings Co., Ltd. (ADR)(NASDAQ:JASO), who are facing charges from the United States and Europe of dumping cheap products in their markets, cut their shipment outlook for the year.
Yingli has said that it expects to ship 2100 MW to 2200 MW against its previous guidance of 2400 MW. JA Solar on the other hand had earlier forecast photovoltaic shipments of 1800 MW to 2000 MW. This has now been cut down to 1500 MW to 1800 MW. According to JA Solar Chief Executive Officer Peng Fang, “The downward pressure on pricing continued. In light of this, we focused on sustaining a healthy balance sheet and building our footprint in key growth markets.”
Yingli, headquartered in Baoding, suffered a loss of 573 million yuan against a net profit of 375.6 million yuan in the corresponding quarter of last year. JA Solar which is headquartered in Shanghai has doubled its net loss from 228.9 million yuan in the second quarter last year to 457.8 million yuan this year.
Since early last year, the sharp decline in prices of solar cells and panels has been eroding manufacturer margins. Chinese solar companies are supposed to have aggravated the situation by flooding the market with cheap solar equipment. The United States retaliated by imposing 31% tariffs on Chinese solar panels including those manufactured by Yingli and JA Solar. Europe may soon follow suit. JA Solar’s shares have fallen by 20% this year, while the Yingli scrip has lost 50%.
Shares of JASO are down 7.77% to $0.987 and YGE slumped 3.60% to $1.88.