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Green Jobs, Domestic Growth, and Overseas Sales: A Winning Combination
Secretary of Commerce Gary Locke visits the plant of United Solar Ovonic’s joint venture partner, Tianjin Jinneng Investment Company, on May 22, 2010, during his trade mission to China. From left to right: Li Gengsheng, general manager of Tianjin Jinneng Investment Company; Gary Locke, secretary of commerce; Jim Finn, resident managing director for United Solar Ovonic. (Photo courtesy United Solar Ovonic)
With help from the U.S. and Foreign Commercial Service, a Michigan-based manufacturer of solar laminates has expanded its business overseas and created jobs domestically. The company’s experience in China points the way for other small and medium-sized manufacturers looking to grow through exports and joint ventures with overseas partners.
United Solar Ovonic, a U.S. company with facilities in Greenville and Auburn Hills, Michigan, is a growing exporter of solar panels. It has been selling to the Chinese market since 2004. A joint venture, United Solar Ovonic Jinneng Ltd., was created in 2009 and is located in Tianjin, China.
Doug Barry of the Trade Information Center recently spoke with Jim Finn, resident managing director in China for United Solar Ovonic, about the company’s products, its approach to the Chinese market, and how it has benefited from the help and advice it has received from the U.S. and Foreign Commercial Service.
Barry: Tell us a little bit about the kind of product that your company makes and what makes it exceptional.
Finn: We make a triple-junction amorphous crystalline solar cell. The reason our product is unique is we deposit the solar cells on coils of stainless steel and have developed a roll-to-roll process where we are able to deposit nine miles of solar cells in about 62 hours. These cells are then sectioned, and grid wires are put on them. They are then assembled into flexible laminates, which are Teflon encapsulated and weather resistant. So, at the end of the day, we have a product that’s extremely lightweight; flexible; and, in real-world conditions, capable of generating a lot more electricity than some of our silicon competitors.
Barry: Can you give us a sense of how cost-effective this technology is?
Finn: It depends on local conditions, the amount of sunlight hours, and the subsidies and feed-in tariffs from different government agencies. Our product is much more sensitive to low-light conditions and has a much better temperature coefficient at high temperatures. So what we normally see is something like 20 percent superior energy generation over the course of a year.
For More Information
The China Business Information Center offers U.S. exporters a wealth of information on doing business in China, including market information, standards and regulations, and links to trade events. It can be accessed through the federal government’s export portal, Export.gov, or by telephone at 1-800-USA-TRAD(E) (1-800-872-8723).
Barry: Solar panels are usually very heavy things. What about yours?
Finn: The solar cells weigh less than a pound per square foot. And because they’re flexible and lightweight, they don’t need any type of support structure. They basically come with an epoxy on the back—a kind of tape, actually—and you peel and stick the tape on the roof. It’s really not much more complicated than that.
Barry: What is the market like in China?
Finn: The Chinese government is very focused on renewable energy and has announced some interesting projects. But currently the installed base in China is about 50 megawatts. That is a relatively low number when you consider other markets, such as Germany, Spain, and Italy.
Barry: How do you see things developing?
Finn: We’re launching a facility with 15 megawatts, which isn’t a huge amount, but we’ve built the facility to handle 60 megawatts. So we will be able to deploy additional capacity quickly. And we’re doing a lot of up-front work with different design institutes, architectural institutes, and some government ministries, such as the Ministry of Urban Housing and Rural Development. The way we look at it, we’re seeding the market now. And as people see the benefits of it, we expect to ramp up fairly rapidly.
Barry: To what extent does your joint venture in China further the goals of the National Export Initiative, which calls for the doubling of U.S. exports in five years and the creation of millions of new jobs?
Finn: We’re a U.S.–based company, with several plants in Michigan. Every solar module that we produce in China uses a base solar cell that’s imported from Michigan. Right now, we import almost 90 percent of our material from Michigan and assemble it here in China, where the product stays. We don’t export anything outside of the Chinese market. Our focus is completely on the Chinese market.
Barry: How do you see things playing out in the future for your parent company and its ability to generate jobs back in Michigan?
Finn: I think we’ve seen the worst of what we’re going to see. We’re starting to announce some very big contracts and business both in Europe and the United States. And that just goes to show that we are starting to gain traction again and that business is starting to pick up.
Barry: How has your company handled protection of its intellectual property, especially having a joint venture with a Chinese partner?
Finn: Technology transfer is a big concern for everyone. In our particular instance, we import the base solar cell, and it’s really that technology that is key to our uniqueness. We’re quite content to provide the technology and the know-how to our Chinese partner. I see no reason to believe that they’re going to do anything nefarious with our technology at this stage. They’re a very good partner and we’ve done business with them for quite a long time.
Barry: What is the most important thing that you’ve learned about doing business in China and about the Chinese themselves?
Finn: The most important thing is relationship building. Trust is a big aspect of that, but there are other aspects as well: mutual respect, honesty, and “up-frontness.” Those are very important things in China.
Barry: So the Chinese expression that more and more Americans will probably become familiar with is guanxi, or “relationships”?
Finn: Yes, guanxi is very important here as well.
Barry: You’ve worked closely with specialists in the U.S. and Foreign Commercial Service in expanding your company’s exports to China. How were they able to help you?
Finn: I can’t say enough about the support we’ve had here in China from the U.S. and Foreign Commercial Service. The specialists were instrumental in getting Ambassador Jon Huntsman to visit our facility for an opening ceremony. They also developed the Energy Cooperation Program that was announced by President Obama and President Hu Jintao in November 2009. It’s a program that brings together 29 U.S. companies with different expertise in clean energy and related technologies to go out into China and develop projects and engage the Chinese government. For a small company like United Solar to be able to walk into a government office with the likes of General Electric, United Technologies, or Dow—it’s really invaluable. So the U.S. and Foreign Commercial Service has been great. They’ve been a really big support.
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