Latest news with #overcapacity
South China Morning Post
18 hours ago
- Business
- South China Morning Post
Overcapacity: the economic buzzword fuelling Europe's clash with China
In a soulless conference room in Brussels in November, officials and experts from around Europe and the United States were locked in a technical debate over a cryptic bit of economic jargon: global non-market overcapacity. Advertisement Beneath the geography-free legalese so common in Brussels, China was undoubtedly the subject. The conference, organised by the European Commission, was designed to thrash out solutions to the problem of overcapacity in China's economy and the second-order effects Europe fears. Decades of overinvestment and state subsidies in China, weak domestic consumption, an addiction to manufacturing, crashing corporate profits, zombie companies that the state does not let die and a superpower trade war have, the EU believes, created a perfect storm. 18:59 Why the EU, US are concerned about China's overcapacity Why the EU, US are concerned about China's overcapacity China's industrial overflows must go somewhere, Brussels thinks, probably at a discount, and the only logical destination is Europe. Governments fear companies that make everything from industrial machinery and chemicals to hydrogen electrolysers and wind turbines will be eaten alive, industries decimated and jobs lost forever. They worry about a wave that could sweep populist parties to power in Europe's hollowed-out manufacturing heartlands. They insist that Beijing should worry too, or face a European anti-China backlash similar to the one that has coursed through the United States over the last decade. Advertisement 'We are seeing a new 'China shock' – as China's economy slows down, Beijing floods global markets with subsidised overcapacity that its own market cannot absorb,' European Commission President Ursula von der Leyen said at the G7 meeting in Canada this week. Back at the Brussels forum on global non-market overcapacity last year, the discussion was becoming bogged down in terminology – 'decreasing profit margins', 'returns on capital', 'underutilised assets' – when an arm shot up in the middle of the room.
Zawya
13-06-2025
- Business
- Zawya
China solar industry to address overcapacity challenge but turnaround far off, experts say
Solar manufacturing company heads in China, grappling with losses and tariffs on exports to the U.S., called for an end to a price war and a solution to overcapacity in the sector, but industry participants predict a slow turnaround. China's solar manufacturers have reported losses this year as U.S. President Donald Trump's trade war put further pressure on demand within the industry. Losses in the photovoltaic manufacturing value chain reached $40 billion last year, while for the industry as a whole - including firms' other business lines - totalled $60 billion, Trina Solar Chairman Gao Jifan said. The Chinese government and industry were working to address the overcapacity and breakneck competition that have pushed most major producers into the red, Gao told the SNEC PV+ Photovoltaic Power Conference and Exhibition in Shanghai this week. The National Development and Reform Commission (NDRC), China's state planner, held an online meeting in February calling for a ban on new production, Gao said, but new capacity has nevertheless been built in recent months. NDRC did not immediately respond to a faxed question on the matter. Zhu Gongshan, chairman of polysilicon and module producer GCL, called for a "clear out" of the sector through mergers and a paring back of production capacity. China was also moving away from reliance on a single market, Zhu said, referring to growth in new markets outside China in response to tariffs and other trade barriers. Chinese manufacturers have been rapidly expanding in the Middle East, and a module-producing firm said demand is set to grow in eastern Europe and South Asia. Solar manufacturing makes up less than two-thirds of Trina's business now and will fall to 50% or less in the next two to three years, Gao said, with a greater focus on product solutions and energy storage. Several experts told Reuters during this week's industry event that there is no hope for recovery in solar component prices this year. One procurement manager at a module producer in eastern China said two or three large factories would have to stop production for supply and demand to rebalance and support prices, unlikely in the near future. "The overcapacity issue is so deep one cannot see to the bottom," another module producer, using a Chinese proverb.
Bloomberg
10-06-2025
- Business
- Bloomberg
China's Solar Chiefs Call for Government Measures to Help Sector
China's struggling solar industry needs government support to ease overcapacity as attempts to self-discipline seem to have failed, company executives said at the industry's top annual event in Shanghai on Tuesday. Because of a large number of companies in the sector, self-discipline 'poses a great challenge in terms of achieving consensus,' Yang Liyou, general manager at Jinneng Clean Energy Technology Ltd., said at the SNEC conference.
South China Morning Post
09-06-2025
- Automotive
- South China Morning Post
China's Geely to stop building new car plants amid severe global overcapacity: Li Shufu
Geely Auto , the mainland's second-largest carmaker, will not build new plants amid excess capacity worldwide, a move that is likely to ripple across the sector as most Chinese companies are finding it difficult to make profits. Chairman Li Shufu told the Chongqing Auto Show over the weekend that the company would avoid building excess capacity and instead focus on improving its technological capabilities to become a key player in the future of mobility. 'The global automotive industry is mired in severe overcapacity woes, [so] we have decided to stop building new car plants,' he said in a video clip posted online. His comments came as carmakers were mired in a brutal price war on the mainland. Leading players such as BYD , Geely and start-up Leapmotor slashed prices of 70 models by as much as 20 per cent in the last week of May to retain market share, according to the 21st Century Business Herald newspaper. Geely Auto chairman Li Shufu told the Chongqing Auto Show over the weekend that the company will stop building new car plants. Photo: Handout Chinese carmakers' discounts more than doubled to a record 16.8 per cent in April from 8.3 per cent in 2024, according to a JPMorgan Chase report in May.
CNA
07-06-2025
- Automotive
- CNA
Geely chairman says global auto industry faces 'serious overcapacity'
SHANGHAI :Geely's chairman and founder Li Shufu said on Saturday that the global automotive industry was facing "serious overcapacity" and that the Chinese automaker had decided not to build new manufacturing plants or expand production in existing facilities. Li made the comments at an auto forum in the central city of Chongqing, according to the company. Geely Holding owns multiple automotive brands including Geely Auto, Zeekr and Volvo. His comments come as the Chinese auto industry, the world's largest, has been locked in a brutal price war that is forcing many players to look to markets abroad and has prompted Chinese regulators to call for a halt. Chinese automakers that have been building plants abroad include BYD, Chery Auto and Great Wall Motor. Geely is planning to use French automaker Renault's existing production facilities in Brazil and take a minority stake in Renault's business in the Latin American country, according to an announcement it made in February.
