image credit: Bamboo Works
Key Takeaways
The Trump administration's effort to cut subsidies for China-linked solar panels manufactured in the U.S. is forcing Chinese companies to scale back ownership
A recent flurry of formal U.S. IPO withdrawals by smaller Chinese companies signals a coordinated push by U.S. and Chinese regulators to sift out low-quality stocks
Donald Trump is creating new headaches for Chinese solar panel makers, just as a slow death seems to be unfolding for new U.S. listings by Chinese companies. We see a shared narrative here. Whether dealing with quiet new policies from the Trump administration or facing intense scrutiny from Wall Street regulators, China Inc. is being forced to adapt. In both areas, Chinese businesses are discovering that flying under the radar and navigating the shifting sands of political and regulatory agendas is the safest way forward.
The solar front has been heating up lately under the Trump administration, which has reportedly tweaked U.S. policies to cut off subsidies for China-linked solar panels, even if they're manufactured in the U.S. These rules dictate that Chinese companies can't own more than 25% of these U.S. plants. This has led a growing number of solar installers to start shunning U.S.-based Chinese factories operated by names like JinkoSolar (NYSE:JKS), Trina (688599.SH), and Longi (601012.SH).
In what looks like a direct response, JinkoSolar announced last week it's selling 75% of its U.S. subsidiary to a private equity company, though it will retain the remaining 25%. We think this is a highly interesting move. Some fear-oriented Chinese manufacturers might be tempted to jump ship, give up completely, and say they're done with the U.S. We'll skip past the ...
