Technological innovation – as the main form of intangible capital –
is prompting profound shifts in the global manufacturing value chain for
photovoltaic (PV) solar panels, which are increasingly found worldwide.
Solar panels have moved from highly specialized products to low-cost commodities, putting pressure on producers. Between 2008 and 2015 prices fell by an estimated 80 percent. In particular, companies have reduced production costs by investing in more powerful production equipment, realizing efficiencies through complementary process innovations and achieving large scale production.
Chinese manufacturers have progressively increased their market share, putting many traditional PV manufacturers in the U.S., Europe and elsewhere, as well as some firms within China, under competitive pressure, resulting in bankruptcies and acquisitions.
The WIPR 2017 shows that overall patent filings in the photovoltaic sector have declined since 2011. In the U.S., Europe and Japan – the traditional sources of innovation in the sector – the decline has been sharp, due to the exit of many firms. However, the surviving firms in these areas have stepped up their investments in research and development (R&D) to develop new PV technologies.
In China, patenting has continued to grow in the sector, including from new firms that have entered the sector. Yet, the proportion of Chinese solar panel patent applications filed in other countries remains below 2 percent.
Many companies are seeking growth in local service markets – such as the installation of solar panels in private homes. In such consumer markets, company and product branding are key intangible assets that help attract consumers and project finance.
Solar panels have moved from highly specialized products to low-cost commodities, putting pressure on producers. Between 2008 and 2015 prices fell by an estimated 80 percent. In particular, companies have reduced production costs by investing in more powerful production equipment, realizing efficiencies through complementary process innovations and achieving large scale production.
Chinese manufacturers have progressively increased their market share, putting many traditional PV manufacturers in the U.S., Europe and elsewhere, as well as some firms within China, under competitive pressure, resulting in bankruptcies and acquisitions.
The WIPR 2017 shows that overall patent filings in the photovoltaic sector have declined since 2011. In the U.S., Europe and Japan – the traditional sources of innovation in the sector – the decline has been sharp, due to the exit of many firms. However, the surviving firms in these areas have stepped up their investments in research and development (R&D) to develop new PV technologies.
In China, patenting has continued to grow in the sector, including from new firms that have entered the sector. Yet, the proportion of Chinese solar panel patent applications filed in other countries remains below 2 percent.
Many companies are seeking growth in local service markets – such as the installation of solar panels in private homes. In such consumer markets, company and product branding are key intangible assets that help attract consumers and project finance.
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