Topcon’s  share of total scheduled PV module production hit 44% in December, competition in Topcon solar cell market intensifies

Topcon solar cell production base construction is advancing strongly as demand beat forecasts. Early capacity builders were able to secure market share and benefit from N-type product premiums during this tech shift. However, after a shortage that lasted through the first half of 2023, Topcon cell demand growth began to fall short of supply growth from September, creating supply surpluses. Profit margins of Topcon cells have shrunk, signaling a tough fight for market share.

1. Existing Capacity Nature Distribution

Initially planned new Topcon cell capacity was 230 GW at the beginning of 2023 and even peaked above 1500 GW by September. Actually installed capacity was 515.7 GW by December, of which about 155.7 GW was still being installed or ramping up.

Of the 515.7GW Topcon cell capacity, 14 firms with both module integration and external cell procurement have 283 GW (54.88% of total), led by Jinko Solar, LONGi, JA Solar and Trina Solar. Twenty-two companies, who solely produce solar cells or have only a small amount of module capacity, like Jietai, Runyang, Zhongrun and Yingfa, contribute 188.6GW. Another 4 companies, including Tongwei Solar, with higher in-house module capacity and cell sales, contribute 43.10GW.

2. Current Topcon Cell Demand Distribution and Growth Curve

SMM research shows that in November, Topcon modules output neared 18GW (36.4% of total). December's Topcon module scheduled production hit 20GW (over 44% of the total), expected to surpass 50% by month's end, aligning with early SMM forecasts. Topcon cell production was about 24GW in November and is set to top 27GW in December (47%-48% of total). Topcon cell supply has been sufficient in Q4.

Examining Topcon cell usage shows 20 module factories as buyers. Most haven't switched from P-type to N-type yet, but upgrades in January should expand buyer numbers. Presently, four leading manufacturers drive monthly Topcon cell sales. Short-term, battery market price declines highlight the cost-effectiveness of external cell buying, OEM, and dual distribution, supporting pure cell makers' line operating rates. Yet, leading buyers' cell self-sufficiency rose last month, hinting at future external procurement drops. End-user install volumes are increasingly swaying battery market dynamics.

Topcon cell market competition hinges on factors like production scale, R&D, cell efficiency, quality, cost/watt, size variety, and downstream partnerships. By 2024, its market share is expected to exceed 70%, intensifying enterprise competition.