LONGi Green Energy has begun gradually shutting down its photovoltaic module factory in Malaysia, while production at its battery cell factory in Vietnam has already been completely halted, according to people familiar with the matter. The developments mark a major shift in the global operations of one of the world’s largest solar manufacturers.
Malaysia was LONGi’s earliest overseas manufacturing base. Since 2016, the company has operated facilities producing silicon rods, wafers, battery cells, and modules in Kuching and Bintulu, Sarawak. By mid-October last year, LONGi’s total investment in Sarawak had reached approximately 8.3 billion yuan. However, sources say the Malaysian module plant has now entered a phased shutdown process.
At the same time, all five production lines at LONGi’s battery cell factory in Vietnam were shut down earlier last week. The factory, located in the Yunzhong Industrial Zone of Bac Giang Province, had been a key part of the company’s Southeast Asian manufacturing network. Two of the production lines were initially planned to be sold to Yingfa Group, but the transaction has since been suspended. No formal agreement was signed and no deposit was paid.
In its 2023 annual report, LONGi stated that by the end of that year, its Vietnam projects—including 3.35GW of battery and related production capacity—had been fully put into operation, with a total estimated investment of 757 million yuan. These projects were implemented through its wholly owned subsidiary, Vietnam NWestern Solar.
Industry insiders believe LONGi’s decision to shut down operations in Malaysia and Vietnam is closely linked to changes in US trade policy. On May 16, the White House announced that the tariff-free policy for importing bifacial solar panels from Malaysia, Vietnam, Thailand, and Cambodia—introduced in June 2022—will expire on June 6. Once the exemption ends, import tariffs will again be imposed on double-glass modules from these countries.
For more than a decade, Southeast Asia has served as a key manufacturing hub for Chinese photovoltaic companies seeking to access the US market. Since the US launched anti-dumping and anti-subsidy investigations into China’s solar industry in 2012, many Chinese firms established module and battery factories in the region. Silicon wafers were shipped from China, assembled into modules in Southeast Asia, and then exported to the United States, allowing companies to bypass trade restrictions. As a result, nearly half of the photovoltaic products manufactured in Southeast Asia ultimately flowed into the US market.
The new US photovoltaic policy is widely viewed as a targeted move to close this loophole. With indirect export routes no longer viable, factory closures in Southeast Asia are increasingly seen as inevitable.
LONGi is not the only company affected. Other major Chinese solar manufacturers, including JA Solar, Trina Solar, JinkoSolar, Canadian Solar, and Risen Energy, all maintain significant production capacity in the same regions. In addition, suppliers of photovoltaic auxiliary materials, such as adhesive films and frames, also operate factories in Vietnam and are expected to face similar challenges.
Despite the widespread impact across Southeast Asia, Laos has so far remained outside the scope of the new US policy. The country hosts relatively few Chinese photovoltaic plants, one of which is Zhongrun Photovoltaic. Compared with the closures in Malaysia and Vietnam, Zhongrun’s battery cell factory in Laos is reportedly operating at full capacity and actively recruiting workers. However, industry observers caution that this situation may not last if major solar companies shift production there, potentially drawing future scrutiny from US authorities.
Even as trade barriers rise, Chinese photovoltaic companies continue to place strong hopes on the US market. Solar installations in the United States are growing rapidly, with newly installed capacity in the first quarter of 2024 rising sharply year-on-year. The US market’s higher profit margins remain particularly attractive amid intense price competition elsewhere.
To adapt, many Chinese solar firms are accelerating efforts to localize production in the United States. At present, Chinese companies have around 12GW of photovoltaic module production capacity in the US, with roughly another 11GW expected to come online this year. LONGi and Canadian Solar have already commissioned new capacity, while projects by JinkoSolar, Trina Solar, and JA Solar are currently under construction.
As the global photovoltaic industry enters a period of heightened uncertainty, analysts say the ability to respond quickly to policy shifts and restructure global manufacturing strategies will be critical for survival in an increasingly competitive and regulated market.
