Over 90% of China's solar supply chain is reporting losses

More than 90% of major Chinese solar manufacturers are losing money, according to the International Energy Agency’s Renewables 2026 report. Module prices have risen 10-30% from 2025 levels, but the increase has not restored profitability. Combined losses among major manufacturers and polysilicon producers grew from about $4.4 billion in 2024 to nearly $5.5 billion in 2025, while more than 70 companies have entered bankruptcy or liquidation since 2024. Margins remained negative through the first three quarters of 2026, though losses appear to be narrowing: the middle half of companies reported margins between -5% and -15%, compared with a much wider range in 2024. Some improvement has come from businesses moving into higher-margin activities such as energy-storage integration.

The IEA expects China to remain dominant in solar manufacturing through 2031, especially in polysilicon and wafers, even as consolidation removes weaker producers and excess capacity. Depending on investment and market conditions, polysilicon capacity could contract by 15-45% by 2031; wafer capacity by 10-35%, and cell and module capacity by 5-15%. Manufacturers outside China have maintained median margins of 10-15%, supported by technology differentiation, local production strategies, and protected markets. New manufacturing hubs, particularly in India, are focused mainly on cells and modules, which require less upstream investment. The report also notes growing interest in battery storage as an adjacent market, while warning that rapid expansion could reproduce solar’s overcapacity problem.