SMTA International Conference Proceedings


Author: Chaim Lubin
Company: Lincoln International
Date Published: 10/4/2009   Conference: SMTA International

Abstract: Solar energy is important to our society in being a part of a sustainable future, but now as the business model for producing solar power has matured it has become an important source of value for forward thinking businesses. Companies across all industries are looking to solar as an alternative source of energy and revenue, and are determining where they can participate effectively. EMS companies in particular have an opportunity to capture value in this market by applying their existing expertise to solar module assembly.

Development into solar can seem foreign or even a daunting task considering the challenges facing EMS companies in today’s economy. However, by understanding the solar process and the existing business model dynamics it becomes clear that the future of solar involves electronics manufacturers. This connection between EMS and solar has been validated through several precedent transactions that have occurred over the last year with more expected during 2009. These transactions are being driven both by EMS businesses who recognize the similarities between module assembly and existing electronics manufacturing processes, as well as existing solar companies that recognize the value of outsourcing this part of their business.

This paper will discuss this opportunity for EMS companies to enter the solar market through module assembly and why this is the appropriate path to pursue. Fist the market for solar and its existing growth expectations will be discussed. This will follow with a detailed explanation of the solar value chain and how the similarities between solar module assembly and electronics manufacturing services provide a unique opportunity for EMS companies. Finally, an outline will be given on two approaches for companies to pursue and the advantages and disadvantages of both.

This will provide the understanding needed by management of EMS companies to realize that now is the time to be considering and dedicating resources to enter the solar market.

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