Sneaky PV quality frauds - part 2

In part 2 of our series about the business conduct and tricks of Chinese pv panel manufacturers to maintain competitiveness and increase profits/ decrease losses at the expense of quality and reliability promises made to customers, which we call PV quality frauds.

Sinovoltaics explores and outlines two further issues: 

C] Subcontracting

It has been common practice for many solar panel manufacturers in China – not only the large ones – to counter production capacity problems or meet a certain target price through subcontracting. In a often recurring form of this procedure, factory A sells the panels at a negotiated pricing to the importer overseas and handles the production work to factory B. Factory A adds a profit margin (does in some cases even not disclose the client’s details to factory B as the goods are first resent to factory A) and maintains toward the client that those panels come from own production. Generally, factory B is carefully picked and instructed to meet factory A’s quality requirements, however quality standards, quality of technical equipment and quality control practices vary greatly between factories, leading to potential problems. Moreover, observations have shown that there are importers that – if finding out – not only are unhappy about this demeanor, literally paying unnecessary extra money to factory A, but are also afraid of potential quality issues and offset marketing incentives if honestly referring to factory B as the product’s source. The issue of subcontracting is quite rampant among Chinese solar manufacturers and may in certain cases pose certain challenges and problems in terms of quality performance, warranty and insurance claims, replacements etc. If undisclosed to a client, a situation which is not rare, subcontracting is a form of brand cheating.

Solution: to avoid unwanted subcontracting, check production factory (factory B) on-site and its relation with the source of purchase factory (factory A). If subcontracting cannot be avoided due to capacity problems, check and compare quality maintenance and control standards between the factories or seek a third party pv quality testing expert to assure quality.

D] Marketing with unobtained certifications and insurances

In an attempt to signal the quality and market access-conformity of their products, the overwhelming majority of Chinese solar panel manufacturers decorate for marketing purposes their websites, brochures and even eMail signatures with nice logos and references to the certifications, insurances and schemes they hold and are part of. Apart from the problem that solar panel certifications are in no away a proof nor a guarantee of a manufacturer’s solar panel quality and Read more about solar panel quality inspections in China & request a FREE example inspection report

About the author
Niclas is Chief Technology Officer at Sinovoltaics Group.Sinovoltaics Group assists PV developers, EPCs, utilities, financiers and insurance companies worldwide with the execution of ZERO RISK SOLAR projects - implemented by our multinational team of solar PV-specialized quality engineers and auditors on-site in Asia.Niclas has been living and working in Asia for over 10 years, including Mainland China, Taiwan, India and Iran. He is solar PV quality specialist with extensive experience with manufacturers in Asia and has before worked on clean energy projects at UNIDO and Grameen Shakti. Connect with Niclas on LinkedIn
S. Gupta

S. Gupta

on 08 Oct 2013

Thanks for the insights regarding frauds in pv industry



on 23 Jan 2014

Very informative, thank you! Are there more scams when buying solar from China?

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