Chinese solar panel maker Trina Solar is reportedly planning a third factory in Vietnam. The news, attributed by Reuters to three sources, comes as Trina Solar is subject to punitive tariffs on exports to the US from its plants in Thailand.

The company is one of the biggest solar panel producers by sales globally and, with two factories already producing components and modules in Vietnam, is one of the country’s biggest solar panel makers.

However, its expansion in Southeast Asia is coming under increasing scrutiny from the US, which claims that Chinese companies benefit from unfair state subsidies.

The planned new factory is expected to span 25 hectares of land and will require $400m in investment, according to Reuters’ sources.

This follows a trend of Chinese investment in Vietnam. According to Vietnamese government data, China was the second biggest foreign investor in Vietnam in 2023, investing $2.7bn in operations in the country between January and mid-August.

Indeed, a fourth Reuters source has suggested that Trina has earmarked a further $600m for investment in Vietnamese solar production in the future.

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Expansion in solar panel production is likely to continue, as Vietnam remains the largest supplier of solar panels to the US, making up a third of US imports in the first quarter of 2023.

The US Department of Commerce issued a final determination on 18 August finding that Trina Solar was one of five companies that was “attempting to bypass U.S. duties by doing minor processing in one of the Southeast Asian countries [Cambodia, Malaysia, Thailand and Vietnam] before shipping to the United States”. Trina Solar’s operations in Thailand were found to be “circumventing” US tariffs.

The company’s new factory in Vietnam would avoid US tariffs, which currently only affect Trina’s Thailand production. However, the Commerce Department will continue to scrutinise Chinese firms exporting products to the US from new facilities in Southeast Asia.

Despite this, Trina Solar’s interest in the Vietnamese market has in recent years been increasingly evident in company filings analysed by GlobalData, Energy Monitor’s parent company.

With US tariffs set to take effect in June 2024 when a June 2022 presidential proclamation that suspended tariffs on solar module and cell imports from the four Southeast Asian countries expires the expansion of operations in Thailand looks set to slow.

The new Vietnamese factory will be the third production plant owned by Trina Solar in Vietnam. Currently, the company has one plant producing solar cells and panels, and another producing silicon wafers in Thai Nguyen. It is currently unclear what the new plant will produce.

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