In-Depth Analysis of TCL Zhonghuan's Capacity Utilization Changes and Industry Trends

Based on collected data and market information, I now provide you with a detailed analysis of TCL Zhonghuan’s capacity utilization changes and the industry trends they reflect.

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TCL Zhonghuan New Energy Technology Co., Ltd. (002129.SZ) is one of the leading domestic photovoltaic monocrystalline silicon wafer enterprises, whose main business covers the R&D, production and sales of photovoltaic silicon wafers, photovoltaic cells and modules[1][4]. As of the end of 2024, the company’s silicon wafer capacity reached 190GW, which will further increase to 200GW in the first half of 2025[4][5].

Indicator	2023	2024	Change
Silicon Wafer Capacity	~180GW	190-200GW	+5.6%~11.1%
Silicon Wafer Shipment Volume	~114GW	125.8GW	+10.5%
Capacity Utilization Rate	~75%	~62.5%	-12.5pp
Market Share	~18%	18.9%	+0.9pp

[2][3][4]: Compiled based on company financial reports and industry research reports.

In terms of capacity utilization rate, TCL Zhonghuan’s rate dropped from approximately 75% in 2023 to around 62.5% in 2024. This change is representative of the photovoltaic silicon wafer industry, reflecting the overall supply and demand imbalance pressure faced by the industry[3][6].

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Year	Global Silicon Wafer Capacity (GW)	Global Silicon Wafer Output (GW)	Capacity Utilization Rate
2021	356	227	63.8%
2022	664	357	53.8%
2023	974	682	70.0%
2024	1,395	753	54.0%
2025E	1,740	799	45.9%

[6][7]: China Business Industry Research Institute and industry analysis reports.

Enterprise	2024 Capacity Utilization Rate	2023 Capacity Utilization Rate	YoY Change
Tongwei Co., Ltd.	89.1%	50.0%	+39.1pp
JinkoSolar	81.3%	72.1%	+9.2pp
JA Solar	70.4%	74.2%	-3.8pp
LONGi Green Energy	60.8%	70.2%	-9.4pp
Trina Solar	59.4%	66.0%	-6.6pp
TCL Zhonghuan	~62.5%	~75%	-12.5pp

[3]: S&P Global Ratings China, In-Depth Adjustment of Photovoltaic Industry Under “Anti-Involution”: Who Can Survive the Winter?

Looking at the industry as a whole, the capacity utilization rate of most photovoltaic enterprises declined in 2024 compared with 2023, generally falling to the range of 40%-70%, and some even dropped below 40%, keeping the industry’s capacity utilization rate at a low ebb[3][8].

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• In 2024, global silicon wafer capacity reached approximately 1,395GW, while output was only 753GW, with the overcapacity rate reaching 85.3%
• The overcapacity rate is expected to further expand to 117.8% in 2025
• China’s silicon wafer capacity is approximately 1,348.8GW, accounting for 96.7% of global capacity

• The entire Chinese photovoltaic industrial chain suffered a total loss of over RMB 60 billion in 2024[8]
• TCL Zhonghuan recorded a net loss of RMB 9.818 billion in 2024, a year-on-year decrease of 387.42%[2]
• The industry accumulated a loss of RMB 31.039 billion in the first three quarters of 2025[9]

This trend indicates that the photovoltaic industry is undergoing a critical transformation from “scale competition” to “quality competition”. The price war triggered by overcapacity has led the entire industry into a vicious cycle of “increasing volume without increasing profit”[9][10].

Time Point	Silicon Wafer Price (RMB/piece)	YoY Decline
2021	5.80	-
2022	4.20	-27.6%
2023	2.50	-40.5%
2024	1.30	-48.0%
2025	0.85	-34.6%

[6][7]: China Business Industry Research Institute and industry analysis.

The sharp decline in industrial chain prices has led to continuous deterioration of corporate gross profit margins:

• TCL Zhonghuan’s gross profit margin was negative in 2024, resulting in gross profit loss[2]
• The average gross profit margin of sample photovoltaic enterprises dropped from approximately 15% in 2023 to around -5% in the first half of 2025[3]
• The lowest quoted price of modules has dropped to RMB 0.6/W, which is lower than the industry’s estimated minimum cost of RMB 0.68/W[8]

Year	N-Type Silicon Wafer Share	P-Type Silicon Wafer Share
2021	10%	90%
2022	25%	75%
2023	50%	50%
2024	72.5%	27.5%
2025E	85%	15%

[6][7]: China Business Industry Research Institute.

The impact of technological iteration on capacity utilization is reflected in:

• Accelerated depreciation of P-type production lines
  : With the rapid increase in the market share of N-type cells, P-type silicon wafer production lines face risks of inventory depreciation and order loss[3]
• Accelerated clearance of backward capacity
  : Improved technical standards have led to the elimination of outdated production lines that fail to meet requirements
• Sustained R&D investment
  : TCL Zhonghuan’s R&D expenditure reached RMB 2.13 billion in 2023, with an R&D expense ratio maintaining around 4%, ranking among the highest in the industry[11]

• Since the second half of 2024, multiple photovoltaic manufacturers have voluntarily announced production cuts, suspension of production, or suspension of new capacity expansion plans[3]
• The industry has spontaneously launched a self-disciplinary production cut negotiation mechanism, with leading enterprises reaching initial consensus on capacity regulation through seminars, alliances, and other forms[3][9]
• It is expected that the industry will see more aggressive production cuts in the third quarter of 2025, with the operating rate decreasing by 10%-15% month-on-month[8]

• The Ministry of Industry and Information Technology and other departments have issued policies to restrict blind capacity expansion and encourage optimized capacity structure[3][9]
• Strengthen capacity monitoring and early warning, and raise energy efficiency and technical access thresholds
• Promote power marketization reform to guide the industry from disorderly expansion to high-quality development[9]

Enterprise	Overseas Project	Capacity Scale
TCL Zhonghuan	Saudi Arabia Crystal Wafer Project	20GW
JinkoSolar	Saudi Arabia Cell and Module Project	10GW
GCL Technology	UAE Granular Silicon Project	60,000 tons
Junda Co., Ltd.	Oman High-Efficiency Cell Project	5GW

[11]: Company announcements and industry reports.

Affected by the international trade environment (the US imposes additional tariffs on photovoltaic products from Southeast Asia, with tax rates ranging from 0% to 271.28%), enterprises are accelerating their overseas layout to avoid trade barriers[3][10]. TCL Zhonghuan holds a 40% stake through its wholly-owned Singapore subsidiary, and jointly built a 20GW project in Saudi Arabia with PIF and Vision Industries[11].

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In the face of the downward trend of industry capacity utilization, TCL Zhonghuan has adopted the following response measures:

• Focus on the product route of large size, flexible category, and high-quality differentiation[4]
• Promote the upgrade of module products to Topcon and BC technologies to enhance product added value[2]
• Module shipments reached 1.9GW in Q1 2025, a year-on-year increase of 19%[2]

• The 20GW photovoltaic crystal wafer project in Saudi Arabia is progressing steadily, with a total investment of approximately USD 2.08 billion[11]
• Respond to the possibility of intensified global trade barriers in the future, and enhance global channel and capacity advantages[11]

• Continue to leverage the advantages of process optimization and technological cost reduction to build differentiated competitiveness[2]
• Dynamically optimize organizational structure, improve management system framework, and enhance operation and control mode[4]
• The profitability of the silicon wafer business improved in the first half of 2025, with Q1 net profit improving by 47.9% month-on-month[2]

• As of the end of 2024, the company has accumulated 4,342 valid authorized intellectual property rights[4]
• R&D investment reached RMB 540 million in the first half of 2025, accounting for 4.03% of operating revenue[5]
• Lay out a BC technology cooperation ecosystem, promote manufacturing transformation, and enhance product traceability[5]

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• S&P Global Ratings China predicts that as market-oriented capacity clearance enters the later stage, and with the continuous advancement of industry self-discipline and policy guidance, the effective capacity utilization rate of photovoltaic enterprises will improve in 2025[3]
• Aixu Co., Ltd. predicts that the photovoltaic industry is expected to recover in the second half of 2026, and the pace of capacity clearance depends on the coordination of market competition, industry self-discipline and policy guidance[9]
• It is expected that enterprises with efficiency and power advantages will be the first to weather the cycle in the next 1-2 years[9]

• N-type high-efficiency products
  : N-type silicon wafers, with higher minority carrier lifetime and lower impurity concentration, have become the mainstream choice for high-efficiency TOPCon and HJT cells[7]
• Thinning for cost reduction
  : The thickness of silicon wafers continues to decrease. In 2024, the average thickness of N-type silicon wafers for HJT cells was 110μm, a decrease of 15μm compared with 2022[6]
• Low-carbon manufacturing
  : Respond to global carbon tariff requirements, and build long-term cost advantages through optimization of energy and material consumption[7]

• The Global Green Energy Council predicts that the global total photovoltaic installed capacity will reach 5,200-5,800GW by 2030[8]
• China’s total photovoltaic installed capacity is expected to reach 1,800-2,300GW[8]
• The growth rate of global new photovoltaic installed capacity will continue to slow down in 2025, but the pace of clearance of backward and inefficient capacity on the manufacturing side will accelerate[6][10]

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TCL Zhonghuan’s capacity utilization rate dropped from approximately 75% in 2023 to around 62.5% in 2024, which profoundly reflects five core trends in the current photovoltaic industry:

1. Severe overcapacity
   : The global silicon wafer overcapacity rate reaches 85.3%, and the industry enters an in-deep adjustment period
2. Sustained low prices
   : Silicon wafer prices dropped from RMB 5.8 per piece to RMB 1.3 per piece, putting pressure on corporate profitability
3. Rapid technological iteration
   : The market share of N-type silicon wafers increased from 50% to 72.5%, accelerating the depreciation of P-type production lines
4. Strengthened industry self-discipline
   : Enterprises take the initiative to cut production, and “anti-involution” has become a core consensus
5. Accelerated global layout
   : Avoid trade barriers and speed up overseas capacity construction

During the industry trough, TCL Zhonghuan has demonstrated strong risk resistance capabilities relying on its scale advantages, technological accumulation and global layout. With the continuous advancement of capacity clearance and deepening of industry self-discipline, the industry is expected to gradually emerge from the adjustment period and enter a new stage of high-quality development from the second half of 2025 to 2026.

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[1] Orient Securities - TCL Zhonghuan (002129.SZ): Price Competition Leads to Performance Loss (https://pdf.dfcfw.com/pdf/H3_AP202504301665044073_1.pdf)

[2] Dongxing Securities - TCL Zhonghuan (002129.SZ): Price Competition Leads to Performance Loss, Strengthen Shortcomings to Enhance Competitiveness (https://pdf.dfcfw.com/pdf/H3_AP202504301665044073_1.pdf)

[3] S&P Global Ratings China - In-Depth Adjustment of Photovoltaic Industry Under “Anti-Involution”: Who Can Survive the Winter? (https://www.spgchinaratings.cn/upload/20251209_Commentary_PV Industry_R.pdf)

[4] TCL Zhonghuan - 2024 Annual Report (http://file.finance.sina.com.cn/211.154.219.97:9494/MRGG/CNSESZ_STOCK/2025/2025-4/2025-04-26/11011386.PDF)

[5] TCL Zhonghuan - 2025 Half-Year Report Summary (https://qxb-pdf-osscache.qixin.com/AnBaseinfo/d5be9483146943aefe97a7bda4a454e2.PDF)

[6] Lianhe Credit Rating - 2025 Photovoltaic Industry Analysis (https://pdf.dfcfw.com/pdf/H3_AP202504061652226616_1.pdf)

[7] China Business Industry Research Institute - 2025 Market Prospect Forecast Report on China’s Photovoltaic Silicon Wafer Industry (https://caifuhao.eastmoney.com/news/20251124125348115776570)

[8] Securities Times - 200GW Rush Installation Cannot Save Photovoltaics? 2025 Industry Examination Arrives (https://www.ditan.com/news/hot/8062.html)

[9] Securities Times - 2025 Photovoltaic Industry Tough Battle: From Price Competition to Value Reconstruction (https://www.stcn.com/article/detail/3550235.html)

[10] Yicai Global - TCL Zhonghuan Expected to See Over 50% QoQ Increase in Loss in Q4 2025 (https://news.qq.com/rain/a/20260114A04KYB00)

[11] Pacific Securities - In-Depth Report on TCL Zhonghuan: Silicon Wafer Leader Shines, Waiting for a New Wave in the Industry Trough (https://pdf.dfcfw.com/pdf/H3_AP202408131639254973_1.PDF)