Lux Populi

Panasonic finally inked its purchase of Sanyo last month. After plans for the takeover became public more than a year ago (see the November 5, 2008 LRPJ – client registration required), the deal was stalled by anti-monopoly regulatory concerns, which forced the pair to sell some nickel-metal hydride (NiMH) battery assets. With those concerns behind it, Panasonic will now be the dominant player in many markets, including large-format NiMH batteries (see the July 1, 2009 LRPJ – client registration required), battery packs for hybrid- and all-electric vehicles (via Panasonic’s JV with Toyota), and Li-ion batteries, where Sanyo and Panasonic were the largest and sixth largest manufacturers, respectively.

The deal means that automotive companies will have fewer options for mass-produced lithium-ion cells for electric vehicles, driving current customers of Panasonic and Sanyo to seek out other qualified battery suppliers – such as LG Chemical’s Compact Power, or Johnson Controls-Saft (JCS) – to maintain multiple sources.

At the same time, however, the acquisition bodes well for Panasonic’s ability to reduce cost in its Li-ion cells, as it can now greatly increase volume. Because of this, the merger of Panasonic and Sanyo will encourage other lithium-ion battery manufacturers to consolidate in order to share similar economies of scale. Clients should expect to see other major tie-ups in the near future as the lithium-ion shakeout comes to fruition (see the December 16, 2009 LRPJ – client registration required).

Further, the acquisition gives Panasonic a strong position in the solar industry, since it now controls Sanyo’s efficiency-leading “heterojunction with intrinsic thin layer” (HIT) cell technology. Sanyo ranks #15 in cell manufacturers by capacity as of Q3 2009 (see the Lux Solar Supply Tracker- client registration required), and its cells top even those of U.S.-based SunPower in the high efficiency segment. Further, Sanyo already has plans in place to aggressively ramp cell capacity to a total of 345 MW by the end of 2010, and to boost ingot and wafer capacity in Oregon, which will total 70 MW when fully ramped in April 2010. All told, the company plans to boost module capacity to a total of 600 MW by the end of this year.

Overall, that puts Panasonic in a very strong position to capitalize on the U.S. residential rooftop market, as well as the high-efficiency panel market in Japan, which is expected to grow in 2010 due to new subsidies. However, a number of competitors, such as Suntech and JA Solar, are making a push into the high-efficiency segment with competing technologies. Although these will likely prove more cost-competitive than Sanyo’s, they’re unlikely to top 20% efficiency. Further, we have recently heard of a Silicon Valley start-up targeting silicon inks for this “selective emitter” technology that is up for sale after exhausting funding; interested clients should contact lr.inquiry@luxresearchinc.com for more details.