September 25, 2012 / 2:21 PM / in 5 years

SMA Solar says no to China, sees lower market share

FRANKFURT (Reuters) - SMA Solar, the world’s No.1 maker of solar inverters, would rather lose global market share than try to enter the fast growing but risky Chinese market, its chief executive said.

“Let me ask you: which international (solar) player is successful in China? Of course, the market is very attractive. But if you can’t find a way of setting up a profitable business there, a market entry makes little sense,” Pierre-Pascal Urbon told Reuters in an interview on Tuesday.

While Europe, the world’s top solar market, is open to all international players, China has been largely sealed off for western groups, which prompted the United States to slap import tariffs on Chinese modules and led Europe to investigate Chinese imports.

Urbon said SMA - whose inverters are a key product in solar plants, helping to feed solar-generated power into the grid - was constantly reviewing whether there were opportunities for the group in China.

“But I cannot say that we’ve been successful in marketing our inverters there,” he added, pointing to the fact that project tenders in the world’s No.2 economy usually favored local players.

The company’s shares erased earlier gains and traded 1.9 percent lower at 1351 GMT after the news.

Depending on how much the Chinese solar market grows this year, SMA’s market share of just below 30 percent will fall further, Urbon said.

The Chinese market accounted for 13 percent of global solar installations in 2011, and is expected to rise to 15 this year, according to data from Brussels-based EPIA, the world’s largest solar industry association.

“We will still try to defend our market share. We will fight,” Urbon said.

Editing by Pravin Char

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