Finance Associated Press, September 15th news (Reporter Guo Songqiao, intern Qu Jiayi) The 2024 China International Fair for Trade in Services (referred to as the Service Trade Fair) is being held in Beijing. This year's Service Trade Fair adheres to the theme of "Global Services, Mutual Sharing", attracting more than 450 world's top 500 companies and industry leaders to participate offline.

JinkoSolar (688223.SH), one of the leading photovoltaic companies in the capital market, has been invited to participate in this year's Service Trade Fair. Prior to this, JinkoSolar announced that it had teamed up with a subsidiary of the Saudi Public Investment Fund (PIF) and local Saudi companies to establish a manufacturing base for the production of 10GW efficient photovoltaic cells and components in Saudi Arabia. This is not only an important step in its global strategy, but also marks the further deepening of Chinese photovoltaic companies in the Middle East and North Africa markets.

Qian Jing, Vice President of JinkoSolar, said in an interview with Finance Associated Press at the National Convention Center, "Service-oriented manufacturing is the next stage of the photovoltaic manufacturing industry and is also the remedy for the current overcapacity. Establishing a manufacturing base for the production of 10GW efficient photovoltaic cells and components in Saudi Arabia is JinkoSolar's breakthrough. Once this model is successful in Saudi Arabia, we will promote this global manufacturing model on a larger scale."

The following is the interview transcript:

Service-oriented manufacturing is the next stage of the photovoltaic manufacturing industry.

Finance Associated Press: How do you view the position, development trends, and future expectations of renewable energy, including photovoltaics, in the global energy structure?

Qian Jing: Based on current data, the world's remaining oil can be used for another 40 years, natural gas for another 50 years, and coal for another 70 years. In any case, these energy sources will be depleted within a century. The imminent disaster is the unlivable warming climate and the dwindling land. Climate change is also profoundly affecting the world, such as experiencing hotter weather and frequent extreme natural disasters. This is the urgent reason for the world to undergo a green energy transformation. Therefore, the transition from traditional energy to renewable energy is an inevitable trend, and the earlier the better for us. Regarding China, solar power currently accounts for 7% of all energy sources, which is on the generation side; on the consumption side, this ratio will be even lower. So I believe that there is still a lot of room for development in photovoltaics.

Caiflun: How do you view the current situation and future trends of the photovoltaic industry?

Qian Jing: The current industry cycle, that is, overcapacity, is caused by a mismatch between supply and demand. Demand growth is inevitable, but it is released in a rhythmic and regular manner. The demand side is constrained by the grid absorption capacity and whether energy storage development is in sync, while this wave of supply side expansion is disorderly. This leads to short-term excess. I believe that the current photovoltaic industry is already at the bottom of the cycle, and the industry has curbed the disorderly expansion of capacity from the source. The future of the industry will gradually improve. In the process of industry clearance, companies without technological advantages, market capabilities, and resource platforms, as well as capacity without competitiveness, will be eliminated. The company hopes to enhance the competitive advantage of photovoltaic products, achieve sustainable operation, and expand its leading advantage through technological improvement, cost reduction, and energy storage application.

A more ideal future state is for new energy generation to be the main source, with thermal power playing a role in peak regulation. Of course, this does not mean completely abandoning thermal power, but gradually reducing it, allowing solar storage stations to take center stage while thermal power plays a supporting role.

Caiflun: What are the ways to solve the current overcapacity in the photovoltaic industry?

Qian Jing: I believe that the current photovoltaic industry is already at the bottom of the cycle, and the industry has curbed the disorderly expansion of capacity from the source. The future of the industry will gradually improve. In the process of industry clearance, companies without technological advantages, market capabilities, and resource platforms, as well as capacity without competitiveness, will be eliminated. The company hopes to enhance the competitive advantage of photovoltaic products, achieve sustainable operation, and expand its leading advantage through technological improvement, cost reduction, and energy storage application.

Significant growth in the Middle East market.

Caiflun: How has Jinko performed in international trade?

Qian Jing: Jinko has ranked first in global component shipments five times, with its products sold in 200 countries and regions. In the first half of 2024, it ranked first in global sales with a shipment volume of 43.8GW, further increasing its market share, with overseas shipments accounting for about 65%. Currently, Jinko has three operational overseas factories in Malaysia, Vietnam, and the United States, as well as a planned factory in Saudi Arabia, with overseas capacity approaching 20%.

Cailian News: In which countries and regions is the growth more significant?

Qian Jing: Previously, due to high photovoltaic prices, it was mainly concentrated in developed countries and regions about 10 years ago, but now it has been shipped all over the world. In the Middle East market, the annual growth rate is 200%, even 300%. For example, about two years ago, Saudi Arabia did not have 1GW, but this year it will reach 8GW. In addition, the growth in Southeast Asia and Latin America is also quite significant.

Cailian News: Currently, there is a rising trend of protectionism in global green cooperation. Will China's current photovoltaic export enthusiasm be affected?

Qian Jing: The current wave of protection measures mainly targets electric vehicles. But in fact, in terms of photovoltaics, it has been under protection measures since 2010. As one of the leading Chinese photovoltaic companies, we also recognize that this trend may be even greater in the future and have a wider scope.

Therefore, we need to change our mindset, from passive to proactive, from individual to collaborative efforts, from sole proprietorship to joint ventures, from product output to technology, experience, system and talent output, from trading to cooperation, from supply ecology to resource integration, and minimize our own risks, which will also help improve efficiency.

Dealing with industry competition, the cooperation to build a factory in Saudi Arabia is Jinkosolar's breakthrough path.

Cailian News: Do you think the Saudi factory model has universality?

Qian Jing: The Saudi factory is crucial for Jinkosolar, and it's like our experimental base. Once this new overseas factory model is successful in Saudi Arabia, we will promote this model on a larger scale.

Before landing in the Saudi factory, facing the 'internal circulation' of the industry, Jinko has always been looking for new strategies and new models. Only the photovoltaic industry in China dares to take this step, because we truly have core technology, sustainable leading capabilities, and can keep up with manufacturing, turning technology into products and forming an industry chain directly. And this model is low-risk and win-win. In the past, it was like frying eggs at home and selling them to you. In the future, it will be like carrying the pan and raw eggs to your home to fry for you. And later, it will be bringing the pan and raising the chickens to your home together, which is the main effect of the chain.

Caixin Media: How's the progress of the Saudi factory?

Qian Jing: The 10GW N-type TOPCon cells and 10GW under construction are expected to start production in the first half of 2026. This will be the first solar cell and module produced in the desert, with an efficiency of up to 27%, so there are still significant challenges.

Caixin Media: What are the advantages of developing the photovoltaic industry in Saudi Arabia?

Qian Jing: The Saudi Public Investment Fund (PIF) is one of the largest sovereign wealth funds in the Middle East and ranks fifth globally. The funding is guaranteed.

Saudi Arabia is located at the center of the Middle East, serving as a hub connecting Europe and Africa. Establishing a base here offers convenient transportation and broad coverage. Saudi Arabia is very friendly to new energy investments and has introduced a series of incentive measures to attract top new energy companies like Jinko to settle in. The skills and work attitudes of Saudi employees are advantageous in the Middle East. Saudi itself has huge potential in the new energy market, with a firm determination for energy transformation by the government. Jinko currently holds a market share of up to 70% in Saudi Arabia. The new Saudi factory is located in the southern industrial city of Saudi Arabia, near NEOM, with low-priced green electricity supply, enabling 100% green electricity manufacturing.