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Transat lant ic Cable
EuroWire – January 2006 18 EuroWire – November 2 09
The environment
China is out in front of the US in the
greening of the world
Keith Bradsher, who is the Hong Kong bureau chief of the
New York Times, has written, “Backed by lavish government
support, the Chinese are preparing to build plants to assemble
their [solar products] in the United States to bypass protectionist
legislation. As Japanese auto makers did decades ago, Chinese
solar companies are encouraging their US executives to join
industry trade groups to tamp down anti-Chinese sentiment
before it takes root.”
Mr Bradsher’s article, filed from Wuxi, a top business centre
in southeast China, describes an extraordinary Chinese effort
to achieve global leadership in renewable energy – solar power
in particular.
What distinguishes this from other ambitious commercial
initiatives is its swiftness and sureness – not to say boldness.
President Barack Obama is on record as aspiring to make the
US the world’s leading exporter of renewable energy, but China’s
leaders have pre-empted the ecology-minded young president,
and on his own turf. (“China Racing Ahead of US in Drive to Go
Solar,” 25th August)
The Times noted that Chinese companies have played a major
role in pushing down the price of solar panels by almost 50%
in only a year. Shi Zhengrong, the chief executive and founder
of China’s biggest solar panel manufacturer, Suntech Power
Holdings, said in an interview in Wuxi that Suntech, to build
market share, is selling solar panels on the American market for
less than the cost of materials, assembly, and shipping.
First Solar (Tempe, Arizona) is still the world’s number one
supplier of photovoltaic cells but Suntech, based in Wuxi, is on
track this year to push past Q-Cells, of Germany, into second
place. Clearly, the solar power race is on, and the American
industry can count on help from the Obama administration.
The Departments of Energy and Treasury announced in August
that they would give $2.3 billion in tax credits to clean energy
equipment manufacturers.
But China is solidly behind its own contenders, and industry
sources interviewed by the Times were sceptical of the ability
of Western companies to hold their own in competition with
Chinese solar products companies with their strong advantage,
especially as to labour costs.
Mr Bradsher noted that recent college graduates in engineering
in China command starting salaries of only around $7,000 a year.
Thomas M Zarrella, chief executive of GT Solar International
(Merrimack, New Hampshire), which sells specialised factory
equipment to solar panel makers worldwide, was prepared
to concede the Chinese hegemony. “I don’t see Europe or the
United States becoming major producers of solar products,”
he told the Times. “They’ll be consumers.”
Washington’s economic stimulus requires any project ❈ ❈
receiving money under the plan to use steel and other
construction materials, including solar panels, from
signatories of the World Trade Organization’s agreement
on free trade in government procurement. China has not
signed. To avoid difficulties, and to reduce shipping costs,
the Chinese company Suntech intends to build a solar
panel assembly plant in the American Southwest – in either
Arizona or Texas.
Steven Chan, Suntech’s president for global sales and
marketing, told the New York Times, “It’ll be to facilitate sales
– ‘Buy American’ and things like that.”
Automotive
An entrepreneur bets on
Italian styling – Fioravanti, no less –
for the products of Detroit
“I believe in the American economy,” Roland Martin, of Martin
International Technologies, told the Detroit Free Press. “You can’t
build a company’s future only on Chinese customers.”
The new company, whose first US office will be in Los Angeles,
plans to introduce renowned Italian design and engineering
to US auto makers as they move to global vehicle platforms.
As reported by Mark Phelan on freep.com, Mr Martin is working
with Fioravanti, the Turin-based company that created the
upcoming Lexus LF-A exotic sports car.
This, together with classics (notably the Dino, Daytona, 308,
and 348) designed by Leonardo Fioravanti during his time
with Ferrari, will be high among Mr Martin’s credentials when
he pitches Fioravanti’s consultant services to companies like
General Motors and Ford. (“Firm Bets on US Market, Will Bring
Italian Style,” 9th August)
Martin International Technologies grew out of a decision by
Mr Martin’s former employer against opening a design office in
Detroit, in favour of working with Chinese auto makers. Believing
this to be a mistake, Mr Martin struck out on his own, at what
he deems a propitious time. He expects the US recovery to be
quicker and stronger than Europe’s because of its underlying
strengths and the optimism that he sees as an element of the
American character.
“Europeans are always afraid tomorrow will be worse than today,”
he told Mr Phelan. “Americans expect it to be better.”
Mr Martin probably knows that optimism – his own and
America’s – will take him only so far. His real stock-in-trade is the
Fioravanti affiliation. As noted by the Free Press, so strong is the
reputation of Leonardo Fioravanti in the Italian auto industry
that Ferrari recently took the unusual step of permitting its
iconic rampant-stallion badge to be fixed on a body designed
by an independent: Fioravanti. The Japanese customer for the
one-of-a-kind SP1 wanted a Ferrari, but requested styling by the
creator of the earlier classics.