Press Information

MHI to Begin Discussions on Details of Photovoltaic Module Business Tie-up
With Auria Solar of Taiwan
-- Move Aimed at Boosting Competitiveness in Thin-film PV Modules --

No.1416
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Tokyo, March 30, 2011 - Mitsubishi Heavy Industries, Ltd. (MHI) and Auria Solar Co., Ltd., a thin - film photovoltaic (PV) module manufacturer in Taiwan, have agreed today to enter into detailed discussions on a framework of collaboration, including capital ties, in the development, production and marketing of thin film PV module. The initiative is aimed at strengthening the two companies' cost competitiveness in the PV module business and at accelerating their dynamic expansion of related business in the global market.

Specifically the two companies will discuss capital participation by MHI in Auria Solar, technical collaboration, and the transfer of certain MHI production lines to Auria Solar. Meanwhile MHI will continue development, production and marketing of thin-film PV modules using a production line for microcrystalline tandem PV modules at the Isahaya Plant of the company's Nagasaki Shipyard & Machinery Works.

Today the PV module market continues to expand globally. Besides Europe, traditionally the major market for PV modules where growth has been supported by measures to promote solar power in many countries, market growth is now steady also in emerging economies such as India and the Southeast Asian countries, where growth is aided by the recognized advantages of thin-film PV modules in warm climates. However, along with the recent sharp appreciation of the yen, prices of PV modules have been dropping due to fiercer competition caused by the emergence of manufacturers in China and Taiwan, which has prompted MHI to urgently seek to further strengthen its cost competitiveness. The company already benefits from its possession of a PCVD (plasma chemical vapor deposition) facility that boasts the world's fastest film deposition speed.

As MHI has been looking to enhance its cost competitiveness, Auria Solar has for some time been seeking to expand its production capacity and enhance its market competitiveness. In this way, the latest agreement meshes the aspirations of both companies.

Auria Solar, established in 2007, is the largest microcrystalline thin-film PV module manufacturer in Taiwan, with annual production capacity of 60 megawatts (MW). The company has been implementing a strategic business expansion program built on its advanced production technologies, and has been developing markets in the emerging economies, including India and Southeast Asian countries, leveraging the cost competitiveness of its products. Auria Solar is currently mulling doubling its production capacity through construction of a new plant as it simultaneously looks to introduce MHI's PCVD technology and establish a plant to produce the world's top-level PV modules.

MHI entered into the PV module market with the construction of a amorphous silicon thin-film PV module production facility at its Isahaya Plant in 2002, and the company has conducted related business aggressively since then. However, recently the company has been pressed to establish a more cost-competitive production structure due to changes in market conditions caused by the global financial crisis and sharp exchange rate fluctuations.

Gaining momentum from the agreement on detailed discussions on collaboration, going forward MHI will further strengthen its competitiveness in the PV module business as it further accelerates dynamic business developments in the global market.