PV book-to-bill forecasts jerky ride for PV equip suppliers

The photovoltaics industry book-to-bill will take the industry on a wild ride in 2011 — from parity to a sharp drop to a rebound, all before next year. Solarbuzz shares what to expect and why it’s happening.

June 6, 2011 — In Q1 2011, the consolidated photovoltaics (PV) equipment Book-to-Bill posted a three-month average of 1.01, according to the Solarbuzz PV Equipment Quarterly report. During 2H 2011, the PV Book-to-Bill will dip sharply below parity before rebounding in Q4 2011. Polysilicon fab expansions and the next phase of c-Si ingot-to-module equipment spending will drive new orders.

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Enhanced PV Book-to-Bill, integrated with equipment spending
analysis, 1Q08-4Q11. (Source: Solarbuzz PV Equipment Quarterly)

 

2009-2010 saw huge PV equipment demand and easy financing, even for tier 2 and 3 PV manufacturers expanding capacity. Across the entire year, the 12-month average PV equipment book-to-bill in 2010 reached 1.27 compared to 0.97 for 2009 (data here). 2011-2012 will bring a retrenchment to Tier 1 expansions only. European equipment suppliers are posting sharp book-to-bill ratio declines, as their over-dependence on c-Si expansions in Europe, faltering tier 2 c-Si spending from China, and speculative thin-film photovoltaics investments are proving costly. Tool suppliers without sufficient inroads to leading Asian producers will most likely suffer in 2012, said Finlay Colville, senior analyst at Solarbuzz.

Colville describes the PV manufacturing landscape as “fragmented” with hundreds of makers at every possible technology stage, with high variation in products. This is challenging for equipment suppliers, and makes internal benchmarks difficult to determine, he added, referring to the book-to-bill as one method to make comparisons. “Combining process tool book-to-bill data with forecasted equipment spending across all segments offers tool suppliers a means of calibrating their in-house prospects lists derived from field sales intelligence,” added Colville.

Detailed PV book-to-bill analysis will be included in the upcoming Solarbuzz PV Equipment Quarterly report, which covers quarterly revenues, bookings and backlogs for leading PV equipment suppliers forecast through Q4 2011; and quarterly process tool equipment spending and projected market-shares for leading suppliers active within each tool sub-segment.

The PV Book-to-Bill ratio compares new order intake to revenues recognized within a given period. It is the ratio of demand to supply in the photovoltaics manufacturing equipment supply chain. A PV Book-to-Bill ratio above parity means that >$100 new orders was received by PV equipment suppliers for every $100 of recognized product revenues.

Solarbuzz, part of The NPD Group, is a market research business focused on solar energy and photovoltaic industries. For more information, visit www.solarbuzz.com.

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