José Jaime Rodríguez
President and Partner
Saya Energy
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Insight

Mexican Solar Panels Close to Competing with China

Wed, 02/24/2016 - 13:25

Many analysts view China and Mexico as manufacturing rivals in a number of industries. This is certainly true of the solar industry, in which Mexico has benefited from high- quality solar panels while also being flooded with a slew of cheap, unreliable counterfeits. For José Jaime Rodríguez, President and Partner of Saya Energy, this rivalry is simply an opportunity. Saya Energy has hit upon an innovative line of business by importing raw materials from Chinese companies that cannot enter the American market, assembling solar products in Mexico, and then exporting them. However, the increasing competitiveness of Mexico’s own solar energy market and manufacturing means that Saya Energy may not need to get its raw materials from China for much longer.

“The opportunities for solar energy in Mexico are significant because the sector is currently experiencing a considerable push from the government,” says Rodríguez. “In terms of competition with the Chinese market, we are close but not close enough. The subject of prices continues to be a common discussion between China and Mexico.” He explains that the cost of solar equipment made in Mexico is approximately 5% more expensive than in China, including transportation and importation costs. Rodríguez is adamant that Saya Energy would no longer have to rely on Chinese components if it had the right access to local suppliers, as it could make panels at home for less. According to him, a fully developed Mexican supply chain could reduce delivery times of the finished products by up to 30 days. “Another problem with solar panels is their price,” he states. “China received significant help from its government, enabling manufacturers to offer cheap panels. Mexico could also produce affordable panels because we have great labor and we could get raw materials at a good price. The cost of labor is pretty similar in China as in Mexico, providing plenty of opportunities for keeping prices lower than Germany, where labor is expensive labor and automation receives heavy investment.” Furthermore, Mexican delivery times to the US are very fast, which is one of the country’s biggest advantages. With the warranties on Mexican products also lasting longer than their Chinese  counterparts, Saya Energy is banking on these strengths to expand its US exports to meet 70% of its capacity.

Currently, Saya Energy only manufactures solar panels from 50W to 310W, for which it exclusively uses polycrystalline technology. It also makes semi-transparent solar panels that can be used as rooftops in the large warehouses of production facilities, enabling natural light to pass through while producing energy. In Aguascalientes, where Saya Energy has its plant, there are approximately only 50 homes currently using solar panels. However, due to low wind resources and the blossoming market, he predicts that this number will increase to 1,000 homes in the next two years.