While many solar companies were profitable before the economic downturn, boosted by government subsidies, the credit squeeze and fall in energy demand has hit them along with the rest of the power sector. This has led some component prices to drop, which has heaped pressure on margins at many manufacturers.
Germany, Japan and Spain lead the market, mainly because their governments took an early lead in pushing the technology's development and, as a result, the industry is led mostly by European companies. However, China and the US are making a concerted effort to make up for lost time. China is already the world's biggest producer of solar panels but exports 90 per cent of the equipment, while many in the industry expect the US to overtake its rivals shortly following increased attention from Washington.
Full story from Financial Times.