Presentation on theme: "SUNPOWER Consulting Report"— Presentation transcript:
1 SUNPOWER Consulting Report Section 2 – Team 2:Herve BuffardPeter CraytonJeff IannacconeObi Okoye-EzeAnup Shah
2 SunPower: Summary Key issues: 2012 Financial Results: SunPower Inc.: Vertically integrated Solar Products Co.Customers: Residential, Commercial & Utility-scale power plant customers.Largest US installed base > 100,000 homes.PV Technology:Maxeon® cell Technology (X-Series)World record panel efficiency > 21.5%.44% more solar power,8-10% more energy per rated watt..Best warranty, performance, reliability & aestheticsIndustry Trends:2012 Financial Results:Key issues:Downward pressure on price.Though revenue is increasing, increasing costs result in lower margin.DG: Need to provide constant power .The Task Ahead:Leverage Core capabilities and form new strategic partnerships to improve upstream and downstream business.Near term: Power-plants:Long term: Distributed generation - Residential and commercial.
3 Analysis: Environmental and Five Forces Five Forces: Solar IndustryRivalry: HighHigh concentration, low differentiation.High exit barriers due to capital investmentThreat of Entry: Low to moderateBarriers to entry: Learning curve, EOS, EOL & Capital requirementsAvailability of Substitutes: HighConventional power, nuclear, Etc.Low switching costsPower of Buyers: HighOvercapacity has forced prices down.Low differentiationPower of suppliers: LowThe Solar industry is not currently a very attractive industry, however the market has huge potential for growth.Environmental Analysis:Demographic trends:Macro-economic impact:Increasing price of oil, Instability in M.East.Socio-Cultural InfluencesDesire for low carbon emission electricityPolitical/Legal pressures:Many incentives for clean energy.Nuclear: Fukushima disasterGlobal trade issuesTechnological DevelopmentsAdvances in PV and HEPV cellsAnalysis demonstrates that the Global Electricity Industry is trending in a positive direction.
4 Analysis: Value Chain, Capability and Competitor Analysis Value Chain Analysis:Core competency = R&D & manufacturing.Capability Analysis:The company’s core capability is rare and imitable, but it is substitutable, and as noted by shrinking margins, the capability is not valuable.Key Competitor Analysis:Chinese Commodity Solar Panel Manufactures: Yingli, Trinasolar, and Sun Tech.PV panel manufacturers onlyPV panels are lower price, lower efficiencyFirst SolarVertically integratedFocused on power plants onlyUse different technology to create cheaper panelsSolar CityDoes not manufactureResidential market onlyPurchases panels, installs for free and charges for the power provided
5 Conclusion SunPower has the following unique advantages: Highest efficiency and most reliable solar PV panels in the marketPartnership with Total SA, over $600m in cash for process improvements and new projects.SunPower must think beyond its current capabilities while leveraging its high efficiency Solar PV technology to create a new superior experience that provides the greatest value being sought by its largest customer groups.We recommend that SunPower take the following steps:Near term: Focus to the higher volume power plant segment. Leverage existing cash to seek out strategic UPP projects. High volume PV panel production will provide SunPower with needed learning to improve process and reduce costs.Long term: Joint venture with Schneider Electric to access battery competency. To differentiate themselves in the distributed generation segment. SunPower's residential and commercial solution must be able to provide constant power required by the customers. Specifically, they need to be able to store sunlight for re-use during peak or other periods when sunlight is not available.