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according to a statement released by the office of the united states trade representative on september 14, cctv news reported that the united states will raise the tariff rate on chinese-made solar cells to 50% from september 27. in addition, the tariff rate on chinese-made electric vehicles will be raised to 100%, and the tariff rate on electric vehicle batteries, key minerals, steel, aluminum, masks and shore container cranes will be raised to 25%.

what is the impact of doubling the tax rate?

the news that the united states will impose additional tariffs on chinese products was first announced on may 14. this time, the latest tax rate and the specific time when the new tax rate will take effect are officially announced.

the main taxation measures imposed by the united states on the photovoltaic sector this time are that the tariff rate on solar cells imported from china (regardless of whether they are assembled into modules or not) will double from 25% to 50% in 2024, which is a continuation of the 301 tariff (a tariff imposed specifically on chinese imports during the trump era).

however, although nominally the us has doubled its tariff rate on china, the actual impact of this tariff is very limited because chinese-made photovoltaic products are almost never exported from mainland china.

"due to various trade policy restrictions, the photovoltaic production capacity that can be directly exported from china to the united states has been almost zero in the past few years, and chinese photovoltaic products have almost no direct export to the united states." zhong baoshen, chairman of longi green energy (601012.sh), said at the 2024 interim performance briefing.

a reporter from china business news interviewed several leading integrated photovoltaic companies, including longi green energy (601012.sh), ja solar (002459.sh), and jinkosolar (688223.sh), and learned that the additional tariffs on solar cells will have basically no impact on domestic photovoltaic companies.

"from the content on the us side, it is mainly aimed at photovoltaic cells (modules) imported from china, and there is no mention of products imported from southeast asia. currently, companies are shipping from southeast asia to the united states." several leading companies told reporters.

"the announcement of additional tariffs will have no impact on china's photovoltaic companies." lv jinbiao, deputy director of the silicon industry expert group of the china nonferrous metals industry association, told china business news that over the past twelve years, photovoltaic products produced in china have basically not been directly exported to the united states.

according to lv jinbiao, after the united states imposed "anti-dumping and countervailing duties" on china's photovoltaic industry in 2012, china purchased battery components produced in taiwan and exported them to the united states. later, the second "anti-dumping and countervailing duties" did not allow the export of batteries produced in taiwan. chinese photovoltaic industry was exported to the united states via bases in southeast asia. during this period, the "anti-dumping and countervailing duties" review did not affect chinese photovoltaic companies.

"the impact of the additional tariffs on chinese photovoltaic companies is not significant. the current main impact of the tariffs is still the us's anti-dumping and countervailing investigations on four southeast asian countries." wang wenqi, photovoltaic analyst at shanghai nonferrous network (smm), told china business news.

focus on the final tariff ruling on four southeast asian countries

since the supply of us photovoltaic battery components mainly comes from southeast asia, the "real" impact on chinese photovoltaic companies is the us tax rate ruling on the four southeast asian countries. according to statistics from industry consulting firm infolink consulting, as of 2023, the main supply of us photovoltaic battery components will still come from southeast asia, accounting for about 60% of the total us market demand.

in may this year, the u.s. department of commerce initiated anti-dumping and countervailing duty investigations on photovoltaic cells (whether assembled into modules or not) imported from malaysia, vietnam and certain other countries.

during the 2024 interim performance briefing, zhong baoshen said: "the actual ruling tax rate will not be determined until september or october, but in the future, the production capacity of the four southeast asian countries will be taxed when entering the us market. because the tax rate is too high, vietnam's production capacity should not be able to enter the united states; malaysia and thailand have no chance to export components, but there are still market opportunities for batteries."

vietnam has the highest initial tax rate. according to data released by the u.s. international trade administration, the so-called dumping tax rates of cambodia, malaysia, thailand and vietnam are 125.37%, 81.22%, 70.36% and 271.28% respectively.

chinese exports to the united states have always been subject to numerous restrictions, including restrictions on photovoltaic products made from chinese polysilicon and industrial silicon in the name of "anti-forced labor." in recent years, after several years of capacity construction in southeast asia, chinese photovoltaic companies have basically formed a complete overseas photovoltaic industry chain, with leading companies having integrated capacity from silicon wafers to components.

although the increase in the us tariff rate on solar cells exported from mainland china to 50% has almost no direct impact on chinese companies, and the us anti-dumping and countervailing investigation against the four southeast asian countries has not yet been concluded, it is clear that the four southeast asian countries are no longer a "bridgehead" for chinese photovoltaic companies to export to the us market, and the future of chinese photovoltaic companies' overseas factory building is showing a decentralized trend.