Analysis of Business Strategies Reflected in TCL Zhonghuan's Workforce Changes

Based on the 2022-2024 annual report data of TCL Zhonghuan (002129.SZ), the company’s total workforce showed a notable trend of

[0][1][2]:

Year	Total Workforce	YoY Change	Background Notes
2022	17,390 people	-	Expansion Period
2023	19,489 people	+12.1%	Capacity Expansion
2024	14,015 people	-28.1%	Strategic Contraction

Between 2023 and 2024, the total workforce

, a dramatic change that deeply reflects the company’s in-depth strategic adjustments amid the bottom of the photovoltaic industry cycle.

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Job Category	2023	2024	Change in Headcount	Change Rate	Strategic Implications
Production Staff	14,176	9,758	-4,418	-31.2%	Capacity Optimization, Automation Enhancement
Technical Staff	3,858	2,779	-1,079	-28.0%	Maintaining R&D Capabilities
Sales Staff	181	229	+48	+26.5%	Strengthening Market Expansion
Management Staff	807	835	+28	+3.5%	Stable Management Team
Finance Staff	164	150	-14	-8.5%	Back-office Streamlining
Administrative Staff	140	102	-38	-27.1%	Efficiency Improvement

Educational Level	2023	2024	Change Rate	Change in Proportion
Master’s Degree and Above	616	564	-8.4%	3.2% → 4.0%
Bachelor’s Degree	4,891	4,053	-17.1%	25.1% → 28.9%
Associate Degree	9,164	6,334	-30.9%	47.0% → 45.2%
Below Associate Degree	4,818	3,064	-36.4%	24.7% → 21.9%

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The 31.2% (4,418 people) sharp reduction in production staff was the largest among all job categories, directly reflecting the company’s active contraction of photovoltaic material production capacity. In 2024, the company reduced the capacity of its N-type TOPCon battery project from 25GW to 12.5GW, and adjusted the planned raised capital investment from RMB 4.624 billion to RMB 1.9 billion [3]. This strategy aims to address the industry-wide losses caused by supply-demand mismatch and declining industrial chain prices.

Reduce reliance on low-skilled production staff by improving automation levels. The 2024 annual report shows that the company continued to promote technological innovation and transformation to Industry 4.0 manufacturing methods, with the core goal of enhancing “relative competitiveness” [0]. Streamlining production staff while maintaining production efficiency reflects the strategic intention of transforming into intelligent manufacturing.

Although the overall workforce was significantly reduced,

:

• Master’s degree and above staff decreased by only 8.4%
• Bachelor’s degree staff decreased by 17.1%
• Staff with below associate degree decreased by 36.4%

This indicates that the company implemented a

strategy during workforce optimization, prioritizing the retention of high-quality talents to reserve core capabilities for technological upgrading.

Sales staff contrarily increased by 26.5% (+48 people), making it the only job category with significant growth. This reflects the company’s strategic shift from “capacity competition” to “market expansion”. Facing intensified competition in the domestic market, the company is accelerating its global layout (investing in Maxeon and Middle East projects), requiring stronger international market development capabilities [0].

Management staff contrarily increased by 3.5% (+28 people), reflecting the management’s confidence in the company’s long-term development. In its annual report, the company clearly stated that “the management team shares responsibilities to promote operational improvement and transformation actions” [0], ensuring the effective implementation of strategic adjustments through a stable management team.

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The photovoltaic industry faced severe challenges in 2024 [3][4]:

• Sustained decline in industrial chain prices: Polysilicon prices fell by over 35%, and silicon wafer prices fell by over 45%
• Low industry operating rates: 66.9% operating rate for silicon material enterprises, 59.9% for silicon wafer enterprises
• A large number of enterprises suspended production: including Akcome Technology, Sunlight Zhongke, Jiangsu Runda, etc.

The company reported a net loss of RMB 9.818 billion in 2024, a year-on-year decrease of 387.42% [0], mainly affected by three factors:

• Gross profit margin of the silicon wafer business plummeted from 22% to -20.53%
• Insufficient competitiveness in the cell and module business, with shipments falling short of expectations
• Significant performance decline of subsidiary Maxeon, with modules returned by U.S. customs

In October 2024, TCL Zhonghuan participated in a symposium on preventing “involution-style” vicious competition in the industry held by the China Photovoltaic Industry Association [4]. Starting from the third quarter of 2024, the company actively adjusted its production and sales strategies, took the lead in practicing industry self-discipline, and participated in market competition rationally.

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• Operating performance has improved sequentially in the first quarter of 2025
• Silicon wafer shipments increased by 10.5% year-on-year to 125.8GW, maintaining the top position in the industry (18.9% market share) [0]
• Shipments of large-size (210 series) products reached 60.4GW, maintaining technological advantages

According to the annual report disclosure, the company will focus on the following in the future [0][3]:

1. Global Layout
   : Continue investing in Middle East projects, hold a controlling stake in Maxeon to expand the U.S. market
2. Technological Upgrading
   : Promote capacity construction of TOPCon modules and BC modules
3. Industry 4.0
   : Improve intelligent manufacturing levels to enhance cost competitiveness
4. Talent Strategy
   : Strengthen R&D team building and optimize talent structure

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The dramatic 28.1% decrease in TCL Zhonghuan’s workforce from 2023 to 2024 deeply reflects the company’s

amid the bottom of the photovoltaic industry cycle. This change is not simply “layoffs”, but a :

Dimension	Strategy Reflection
Capacity	Proactively contract inefficient production capacity, promote project postponement or reduction
Manufacturing	Accelerate Industry 4.0 transformation, improve automation levels
Talent	Capacity reduction with quality improvement, retain core highly educated talents
Market	Strengthen sales force, accelerate global layout
Management	Stabilize management team, ensure implementation of changes

Although this “resolute wrist-cutting” adjustment causes short-term pains, it lays a foundation for the company to survive the industry reshuffle and seize the next round of growth opportunities. As Chairman Li Dongsheng stated in the annual report, the company is “striving to transform its business philosophy and promote business changes”, and is confident in achieving performance improvement in 2025.

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[0] 2024 Annual Report of TCL Zhonghuan New Energy Technology Co., Ltd. (http://file.finance.sina.com.cn/211.154.219.97:9494/MRGG/CNSESZ_STOCK/2025/2025-4/2025-04-26/11011386.PDF)

[1] 2023 Annual Report of TCL Zhonghuan New Energy Technology Co., Ltd. (http://file.finance.sina.com.cn/211.154.219.97:9494/MRGG/CNSESZ_STOCK/2024/2024-4/2024-04-26/10113564.PDF)

[2] 2022 Annual Report of TCL Zhonghuan New Energy Technology Co., Ltd. (https://pdf.dfcfw.com/pdf/H2_AN202303281584625816_1.pdf)

[3] Shanxi Securities - Mid-Year Strategy Report on Solar Photovoltaic Industry (https://pdf.dfcfw.com/pdf/H3_AP202408141639275341_1.pdf)

[4] Yicai - “Late-Night Release of Hundred-Billion Loss Financial Report: What Signals Does TCL Zhonghuan’s Worse-Than-Forecast Performance Reveal?” (https://www.yicai.com/news/102591058.html)