Panasonic is still making solar panels and a whole suite of energy products — just not in-house
To clear up any confusion, Panasonic is not exiting the solar market. The nearly 100-year-old company has made a strategic decision in the solar energy field to design an ecosystem of residential energy products instead of focusing solely on manufacturing. Consumers and its network of installation dealers can still rely on Panasonic for solar panels, batteries and other energy management products – the only difference being that the company now uses an Original Equipment Manufacturer (OEM) to make its products.
Panasonic announced earlier this year that it would end production at its Malaysian and Japanese plants by March 2022, instead moving solar panel production to a subcontractor. Solar energy world spoke exclusively with Mukesh Sethi, director of solar and energy solutions at Panasonic, about this business hub. He explained the decision as following production trends in the industry.
Panasonic’s long-standing line of HIT panels, a pioneer in the production of heterojunction technology (HJT) panels, used internally manufactured cells of smaller 125 mm/5-inch. wafers for 96-cell panels in the same footprint as other brands’ 60-cell modules. In recent years, there has been an acceleration of new technologies and greater adoption of wafers across the industry, leading to Panasonic making the decision to outsource manufacturing and end the HIT line of smaller cell panels. .
Panasonic’s latest line of modules under the EverVolt brand still use HJT, but with larger half-cut cells to be more uniform with the rest of the industry. Since it was probably the last company to still use the smallest wafer size, it was a smart business decision to go onboard with larger, more mass-produced solar wafers.
SunPower, the largest competitor to Panasonic dealers in the US, followed a similar path in 2020. SunPower also produced a 96-cell panel before handing over its manufacturing efforts to new company Maxeon. SunPower now focuses on installing and designing a range of energy products, while selling SunPower modules from Maxeon with larger cells.
Sethi wanted to reiterate to the industry that everything about Panasonic remains the same when it comes to solar: the same 25-year warranty, the same commitment to product quality, the same service model. Here he answered a few more questions for that: Solar energy world.
SPW: What is the background to Panasonic’s production announcements?
Sethi: That announcement was made in early 2021 where Panasonic said it would no longer make solar panels and we will move to an OEM model, which has caused confusion among customers and stakeholders that we are exiting the solar industry altogether, which is clearly not true. This is just a change in strategy. We don’t leave anything.
There are so many companies, big house brands, that are already doing this sort of thing. They design the products and sell the products without manufacturing them themselves. Most consumers don’t see that. All they see is a brand name and not necessarily what steps are taken to make the product.
SPW: Why did Panasonic decide to outsource panel production?
Sethi: We are the pioneer of heterojunction technology and have been making panels for 25 years. We have made significant progress in efficiency and output over time. We have increased our production capacity so many times by opening new production lines and facilities, but in the past two to three years, the solar industry has changed significantly. The cost of solar panels and cells has fallen and new technologies have emerged, requiring large upfront investments in larger cells. So instead of focusing on solar panel manufacturing, which has now become a low-margin business category with ever-decreasing prices and changing technologies, making it difficult for manufacturers to keep up with the ongoing investment in new machines, we have decided to outsource production so that we can only focus on designing and selling the product. This allows us to bring the latest technology in third party solar panels at competitive prices along with other energy products that are part of residential energy solutions. It’s not just the panels we want to focus on. We want to go beyond the panels and focus on the whole ecosystem of energy products, which work very well together and are designed, developed and sold — but not produced — by Panasonic.
SPW: What is Panasonic’s focus going forward?
Sethi: Nothing changes for our dealers. The only thing that has changed is that the panels are not made in our own factories. Our focus has always been on the residential energy sector. We are evolving from a solar product manufacturer to a complete energy solution provider that designs energy products and solutions, including solar panels, inverters and energy storage. We envision an ecosystem of best-in-class solutions controlled and managed by AI software that can manage the needs of the homeowner and integrate with the utilities and energy aggregators. You want all products from one brand to work very well together. When a homeowner buys a product, they don’t want to buy five different brands in the energy solution system. They want one brand as they do for their phones and consumer electronics in the home. Energy products will be comparable.