Chinese Turbine Makers Set to Overcome Hurdles for Success in U.S.

In a recent article in North American Windpower, Bruce Hamilton and Andy Wickless identify the challenges facing Chinese wind turbine manufacturers looking to increase their U.S. market shares. Currently, Chinese original equipment manufacturers (OEMs) make up 90 percent of the Chinese market, but less than 1 percent of the U.S. market. Chinese OEMs are now looking for ways to expand to a global market, particularly in parts of Europe and the U.S. Hamilton and Wickless claim, “there is not really a single global market for wind turbines…there is a Chinese market and a non-Chinese market.”

Chinese OEMs have a few advantages supporting their efforts, as they can offer lower prices and receive support from the Chinese government. To make the most of those advantages, they need to prove the performance of their wind turbines to customers although not much performance data is available as of now. The Chinese OEMs will also face cultural differences, which could hinder their success. To overcome that hurdle and others, including weak product design capabilities, several companies are seeking partnerships with Western OEMs.

Windpower-Chinese.pngPerhaps the greatest challenge is that many wind farm owners are hesitant to do business with an OEM based in China. Should they need a new part, these owners fear losing revenue while replacement parts are shipped all the way from China. Parts that are manufactured locally and readily available in the U.S. are much more enticing – another driver for Western partnerships.

To develop a strong presence in the U.S. market, Chinese OEMs should partner with in-country subcomponent manufacturers. Then, they will be able to increase production of parts in the U.S. and subsequently provide for a higher quality wind turbine.

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