Tariff pressure reshapes solar trade routes in Malaysia. (Photo: iStock)
The U.S.'s ongoing tariff campaign targeting Chinese solar companies operating in Southeast Asia appears to be yielding results.
Industry insiders in Malaysia report that rising costs have made it increasingly difficult for China-backed solar manufacturers to maintain operations. However, the new duties are unlikely to affect local manufacturers, and developers and installers may even benefit from the global oversupply and falling prices in the solar market.
New tariffs threaten Chinese solar makers in Malaysia
While there’s no definitive data quantifying the impact on Chinese solar exports routed through Malaysia, figures from the Malaysia External Trade Development Corporation (Matrade) show that total exports to the U.S. have declined. In 2024, Malaysia's solar exports to the U.S. fell to RM12.5 billion (about USD 2.8 billion), down more than 20% compared to the previous two years.
Davis Chong Chun Shiong, president of the Malaysian Photovoltaic Industry Association (MPIA), noted that more Chinese solar panel manufacturers are likely to exit the Malaysian market following the latest U.S. tariff announcement, with some already relocating beyond Southeast Asia. As a result, these tariffs are not expected to further impact domestic manufacturers.
The U.S. Department of Commerce released its findings from anti-dumping and countervailing duty investigations on April 21. The proposed new tariffs on Malaysian solar exports to the U.S. range from 14.64% to 250.04%. Chinese firms operating in Malaysia, such as Jinko Solar and Baojia New Energy, were hit with rates of 40.3% and 250.04%, respectively.
Data from energy consultancy Wood Mackenzie shows that Chinese manufacturers account for nearly 80% of Malaysia’s solar production capacity. The remainder is mainly controlled by U.S.-based First Solar and South Korea's Hanwha Qcells.
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Malaysian solar industry leader says the latest U.S. tariff hike will not impact local manufacturers. (Photo: iStock)
Mild impact expected amid global oversupply
Chong, who is also CEO of Malaysian solar company Solarvest, said that despite the tariffs, ASEAN will remain a key supplier of solar panels to the U.S., and some residual capacity will persist.
Domestically, most solar panels used by Malaysian installers are imported from China, which means local manufacturers focused on exports remain largely unaffected.
According to Samaiden Group managing director Chow Pui Hee, unless Malaysian manufacturers can offer lower prices and better value than Chinese imports, they are unlikely to gain a foothold in the local market.
TA Securities stated in a report that global solar panel prices are nearing their floor, suggesting only a "mild impact" on Malaysian companies. Chong also estimated that if prices stay below USD 0.10 per watt, local developers and installers stand to benefit from the lower input costs.
Source: The Edge Malaysia, The Straits Times
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