June 13, 2012 / 8:01 AM / 6 years ago

Suntech raises prices in U.S. as competition wanes

* Increased prices by 1-2 percent in U.S. - CCO

* Expects costs to drop by 10-15 U.S. cents by yr-end

MUNICH, June 13 (Reuters) - China’s Suntech, the world’s No.1 maker of solar cells, has slightly lifted prices for panels in the United States, after punitive tariffs imposed last month on panel imports from China weakened competitors.

Suntech, which is also affected by the tariffs, has been able to cope much better with the decision than many of its smaller Chinese peers, mainly due to its global supply network, chief commercial officer Andrew Beebe, said.

“We changed our supply chain and purchased less in China,” he told reporters on the sidelines of Intersolar, the world’s largest solar trade show.

He said the company was even able to raise prices in the United States by a modest 1-2 percent, adding the import duties were leading many of its Chinese peers to drop out of the U.S. market, leaving Suntech to fill the gap.

“Many Chinese firms cannot compete anymore,” Beebe said.

Solar installations in the United States jumped 85 percent in the first quarter of 2012 compared with the year-earlier period, data from GTM Research showed earlier on Wednesday.

This prompted the research firm to raise its forecast for U.S. installations to 3,300 megawatts (MW) this year, up from a previous 2,500-2,800 MW, which would likely make the United States the world’s fourth-largest solar market in 2012.

In May, the U.S. Commerce Department imposed tariffs of around 30 percent, much bigger than had been expected, after it ruled in favour of local firms which said Chinese exporters were dumping cut-price panels on their market.

Under the decision, 59 Chinese solar companies that petitioned Washington in the case will face an import duty of about 31 percent, including Yingli Green Energy, LDK Solar, Canadian Solar, Hanwha solar One , JA Solar Holding and Jinko Solar.

Beebe also said he expected Suntech’s production costs to fall by 10-15 U.S. cents per watt by the end of the year from 70-80 cents now, but added it would be hard to predict how costs would develop next year.

Suntech, which posted a first-quarter net loss of $133 million in late May, forecast sequentially higher gross margins for the current quarter, betting on price hikes and cost cuts to tide over the anti-dumping duties.

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