PV module shipments grew for the sixth consecutive quarter to 4.4 GW in Q2’10, while channel inventory also remained extremely high at almost the same figure, according to ongoing analysis from IMS Research. However, despite production lines running at close to full utilization to satisfy orders for the remainder of the year, the majority of cell and module suppliers are preparing for harder times and remain cautious as to how the market will cope with incentive cuts in Germany, Italy, France, Czech Republic and other markets at the close of the year.

Some major cell and module suppliers voice concern over inventory levels, capacity expansions and anticipated weakened demand at the start of next year.

Channel inventory levels are currently particularly high, and IMS Research estimates that at the end of Q2’10, 4.3 GW of PV modules had been shipped by suppliers, but not installed. Though it’s worth noting that a large proportion of these modules is not sitting in warehouses, but in transit from Asia, moving through distribution channels and installed in systems yet to be connected to the grid. Although inventory levels are forecast to decline in the fourth quarter after a surge in completed installations, these high inventory levels are likely to further impact on shipments in early 2011, given the slowdown in demand that is predicted.

“In September, we spoke to dozens of suppliers throughout the entire supply chain,” commented PV Research Analyst, Sam Wilkinson, “very few are reporting any visibility beyond the fourth quarter and are bracing themselves for a major reduction in demand and shipments." IMS Research forecasts that the end of 2010, which has been an incredible year for the PV industry, will be marked by over 5 GW of PV installations being connected to the grid in the final quarter alone. However, installations are predicted to decline by 65% sequentially during the first quarter of 2011,” Wilkinson continued.

Further Information: IMS Research (http://www.pvmarketresearch.com/)