Aiko Solar Says Photovoltaic Capacity Shakeout Is Near Its End

Aiko Solar's chairman Chen Gang has argued that China's photovoltaic capacity shakeout is approaching a decisive stage, offering a more nuanced view of industry clearing than simple factory closures or mergers.

Speaking around the SNEC solar exhibition in Shanghai, Chen said industry sentiment remained weak and capital was still leaving the solar sector. But he argued that capacity clearing was near the end of the downcycle, even if outside observers might recognize the turn more slowly.

His definition of clearing is broader than the usual language of shutdowns, bankruptcies and consolidation. Some mainstream companies may fade from specific solar segments while shifting their main effort to other businesses. Others may stop investing in cells or modules, which gradually reduces their relevance as the market moves toward higher-efficiency products. Smaller companies that copy technology upgrades without scale or deep know-how can also be cleared passively when leaders keep iterating.

That framing matters because China's solar industry still has too much nominal capacity. A factory can remain open while becoming commercially obsolete. If customers migrate to higher-efficiency products, if banks tighten credit against lower-efficiency lines, or if policy standards make older capacity less financeable, the market can clear without a dramatic wave of closures.

Chen pointed to potential mandatory efficiency standards as one catalyst. If three-tier compulsory efficiency rules are implemented, financial institutions may use them to restrict credit and project owners may shift faster toward advanced capacity. That would accelerate a process already underway through technology competition.

Aiko's own position is built around its ABC technology route. The company says ABC module shipments have grown rapidly, from hundreds of megawatts in 2023 to several gigawatts in 2024 and more than 14 gigawatts in 2025. Management expects continued growth this year, with order demand constrained mainly by capacity release.

The company also says ABC products still command premiums in overseas high-end residential, commercial and ground-mounted markets. That is important because the broader solar manufacturing chain has been under severe margin pressure. A technology premium can provide a route out of the commodity trap, but only if customers continue to pay for efficiency gains and if competitors cannot narrow the gap quickly.

Aiko is not insulated from the downturn. It reported first-quarter revenue growth but remained loss-making, with net profit pressure linked partly to financial expenses. Management has acknowledged that its higher-value BC capacity is still limited compared with the company's total capacity base, which includes older PERC and TOPCon lines. That creates a burden: the advanced business must grow fast enough to absorb or offset the drag from legacy assets.

The company's outlook therefore depends on several linked variables. ABC capacity must ramp on schedule, overseas orders must remain durable, and the technology must prove competitive as it moves beyond premium distributed markets into larger centralized projects. Manufacturing cost, silver-free technology and reliability will all affect whether the premium survives.

For the photovoltaic sector, Aiko's comments show how the next phase of clearing may occur. The winners may not simply be the companies with the largest balance sheets. They may be those that can turn technology migration into pricing power while competitors are trapped with older lines and weaker financing access.

The risk is that every downturn produces optimistic calls that the bottom is near. Solar cycles can stay painful longer than expected because capacity is difficult to remove and local governments often prefer to keep factories alive. Aiko's thesis will become more convincing only if prices stabilize, financing starts to distinguish sharply between efficiency levels and advanced products continue to sell at measurable premiums.

The industry is moving from expansion logic to survival logic. If Chen is right, the shakeout will be less about a single wave of closures and more about a steady reallocation of orders, credit and technology relevance. For Aiko, the opportunity is to be on the right side of that reallocation before the rest of the market recognizes it.