Trina Solar Strategic Analysis

Running head: TRINA SOLAR STRATEGIC ANALYSIS
Trina Solar Strategic Analysis
Name of the student:
Name of the university:
Author note:

1
TRINA SOLAR STRATEGIC ANALYSIS
Table of Contents
Introduction:....................................................................................................................................2
Purpose of analysis-.....................................................................................................................2
Overview/outline of written report-.............................................................................................2
Description of the company-.......................................................................................................2
1. Description of the General Environment dimensions and Specific External Environment
dimensions:......................................................................................................................................2
1.1 PESTLE analysis:..................................................................................................................2
1.2 Global solar industry:............................................................................................................6
1.3 Five Forces:...........................................................................................................................6
1.4 Demand and market segments:..............................................................................................8
1.5 Discussion of the competitors:...............................................................................................9
2. Company/Organization/Internal Environment:...........................................................................9
2.1 Brief history (suggest including a Time Line as an exhibit):................................................9
2.2 Vision/mission statements/strategic objectives:..................................................................10
2.3 Organization:.......................................................................................................................10
2.3.1 Culture:.........................................................................................................................10
2.3.2 Leadership including analysis of the board:.................................................................11
2.4 Value Chain Analysis:.........................................................................................................11
2.4.1 Operations, Marketing, Supply Chain, Distribution:....................................................12
2.4.2 Core competencies and Comparison:...........................................................................12
2.4.3 VRIN:...........................................................................................................................13
2.5 Financial statements and Analysis:......................................................................................13
2.5.1 Stock Value performance:............................................................................................13
3. Strategies of the firm – Description of the current strategy choices of the firm:......................13
3.1 Generic or Business level strategy:......................................................................................14
3.2 Corporate Level Strategy:....................................................................................................14
3.3 Use of BCG matrix if appropriate for the firm:...................................................................14
4. SWOT analysis and recommendations:.....................................................................................14
4.1 SWOT table:........................................................................................................................14
4.2 Discussion of the SWOT:....................................................................................................15
4.3 Recommendation based on your analysis:...........................................................................16
Bibliography:.................................................................................................................................17

2
TRINA SOLAR STRATEGIC ANALYSIS
Introduction:
Purpose of analysis-
The purpose is to analyze the internal and the external environment of the chosen
business. The chosen business is “Trina Solar” which is headquartered in Changzhou (China).
The company has its presence at the global level and branches in the United States, Asia, and
Europe1. The analysis is also aimed at finding the issues if there is any and giving the feasible
and strategic recommendations to it.
Overview/outline of written report-
The analysis of the chosen business is being done through various management concepts
such as the PESTLE analysis, five forces, VRIN framework and more. For internal analysis,
SWOT analysis of the company is being done. It also covers the organizational culture and the
leadership style in the chosen company. It does also cover the financial analysis of the company.
Moreover, the study is aimed at analyzing the chosen business from every possible perspective.
Description of the company-
Trina Solar headquartered in Changzhou (China) is a globally recognized name in the
production of solar panels. The company was formed in the year 1997 by Jifan Gao2. The
company is primarily focused on producing ingots, solar cells, wafers and solar modules. The
company was listed repeatedly in the fortune list of 100 fastest growing companies in the world3.
Trina outperformed Yingli as the world’s biggest maker of solar panels. Trina is now the world’s
leading provider of solar solutions in the form of PV products, services and applications4. The
innovative strategies of the company did not only work in its favor but, has also furthered the
industry’s prospects through the production of PV power with greater grid parity and
popularizing the renewable energy. Their mission is set on popularizing the solar system as a
resource for renewable energy and benefitting the humanity. As of 2017, Trina has delivered
more than 32 GW of solar modules across the global countries. This has helped the company to
become the largest solar module supplier at the worldwide level. At the moment, the production
of Energy Internet Solutions and Smart PV energy is helping the company to break new
grounds5.
1. Description of the General Environment dimensions and Specific External Environment
dimensions:
1 Trinasolar. 2018. Trinasolar.Com. http://trinasolar.com/.
2 Trinasolar. 2018. Trinasolar.Com. http://trinasolar.com/.
3 Archive.fortune.com. 2018. "100 Fastest-Growing Companies 2010 - From FORTUNE". Archive.Fortune.Com.
http://archive.fortune.com/magazines/fortune/fortunefastestgrowing/2010/full_list/.
4trinasolar. 2018. Trinasolar.Com. http://trinasolar.com/.
5trinasolar. 2018. Trinasolar.Com. http://trinasolar.com/.
5

3
TRINA SOLAR STRATEGIC ANALYSIS
1.1 PESTLE analysis:
Political: Trump’s announcement for tariffs being imposed on the imported solar panels
means that the cost of solar panels will rise in the nearing future. This is just an opposite trend
for solar power as lower and middle class families are its biggest purchasers. The imposed tariff
will increment the price of solar products. Hence, the rate of sales will also decrease. Trump has
considered the move as a good one for the local manufacturers. However, the statement made by
Trump has missed covering the after effects on the purchasing behavior. The purchasing
behavior will expectedly be influenced. Hence, demands for the unit of solar products will
considerably decrease. Now, it looks really confusing that how the makers of solar products will
enjoy an incremented business. On the other hand, the low-wage countries will expectedly grow.
Trina Solar will continue to perform better in other parts of the world like its home country
China and Asia6. It further means that foreign manufacturers will be yielding good profits from
the business whereas local manufacturers in America will suffer.
It is expected to produce a deficit in the manufacturing of solar panels. This will result in
price rise and job cuts. A rise in price means it would hamper the buying capability to a
considerable extent. More people will remain unconnected to the technology which could have
been extremely beneficial for a sustainable environment7. It is cost-saving as well. This is
because it provides a relief from roaring electric bills. However, the Trump’s announcement may
not allow such thing as the tariff on imported solar panels will make it expensive. Job cuts will
also be the possibility. The import tariffs may reduce the quantity of imported solar panels.
Hence, the number of jobs will also reduce8. In addition to this, the other renewable energy
resources like gas and wind will be more in practice. Hence, customers would be left with the
other options like gas and wind as an alternative to electricity. This is problematic for Trina Solar
as well. The manufacturing plant in the USA will suffer from the decision as production will
decrease. The import from China will also suffer. Hence, the mission to benefit the entire
humanity may get hampered.
Economic: The announcement made by Trump may seriously affect the solar industry in
the United States of America9. The increased tariffs on the imported solar panels will mean
increased prices of solar panels. Hence, customer capability to purchase the solar panels will
considerably decrease. The market which was accelerating due to the falling cost of solar
products may now suffer a loss. The loss will mean a less installation request for the workers.
Hence, job cut will rise. The solar industry which once holds a reputation to provide jobs more
than even the oil & gas industry may now struggle to maintain the same behavior10. More jobs
cut will happen resulting in an increased unemployment rate. This is not a very healthy sign for
“Trina Solar” as it may also face workers quitting their jobs. The company may struggle to
6 Sun, Honghang, Qiang Zhi, Yibo Wang, Qiang Yao, and Jun Su. "China's solar photovoltaic industry development:
The status quo, problems, and approaches." Applied Energy 118 (2014): 221-230.
7 Plumer, Ana. 2018. "Trump’S Solar Tariffs Are Clouding The Industry’S Future". Nytimes.Com.
https://www.nytimes.com/2018/01/23/us/politics/trump-solar-tariffs.html.
8 Marx, Ive. "Job Subsidies and Cuts in Employers' Social Security Contributions: The Verdict of Empirical
Evalution Studies." Int'l Lab. Rev. 140 (2001): 69.
9 Plumer, Ana. 2018. "Trump’S Solar Tariffs Are Clouding The Industry’S Future". Nytimes.Com.
https://www.nytimes.com/2018/01/23/us/politics/trump-solar-tariffs.html.
10 Akerlof, George A., Andrew K. Rose, Janet L. Yellen, Laurence Ball, and Robert E. Hall. "Job switching and job
satisfaction in the US labor market." Brookings papers on economic activity 1988, no. 2 (1988): 495-594.

4
TRINA SOLAR STRATEGIC ANALYSIS
accelerate its growth and attract more skilled workers. This will also give an edge to other
resources which are the competitors of solar energy. The list of competitors includes coal, wind,
and gas. Coal, in particular, was being affected by the rising popularity of solar industry in
America. However, the imposed tariffs will considerably reduce the rising of the solar energy
and boost the coal industry11. Such facts will not only hamper the mission statement of Trina but,
this will also affect the American people and the environment. Solar energy and the other forms
of renewable energy are the needs of the entire world especially the United States considering a
fact that it is one of the largest carbon emitter countries.
Socio-demographic: Surprisingly, the customers for solar products are not the rich people
or the city-dwellers; it is rather the lower and middle income family living in suburbs. They are
buying the solar powers in most cases. The reduced price of solar products has also encouraged
the lower and middle class family in the recent few years. It was quite affordable to the classes
which are also why the sales have grown up in the last five years. The lower and the middle
income classes had shown a notable inclination to the concept. To them, it is a good way to get
rid of the high electricity bills. The use of a solar product will also mean a reduced CO2 emission
and hence, the CO2 content in the nearby areas will be low. This is indeed a very good way to
live a very healthy life. The reduced prices of solar products had boosted the sales of solar
products; however, the fact may not stay alive for a longer period of time12. This is due to the
announcement that Trump has made on the trade tariffs. The announcement will affect many
trades including the imports of solar products. This may reduce the import frequency and
dependency will increase on the local manufacturers. This was exactly what Mr. Trump had
meant. However, Trump seems to have missed a point that imposing the trade tariffs on the
imports of the solar product may also hamper the buying behavior of customers. The move will
ensure an incremented price and hence, solar products will become costlier. Existing customers
might face the challenge. Hence, sales will be influenced. The sales figure may expectedly go
down as solar products will become expensive. Home ownership is still a characteristic of the
solar user. Solar homes generally come up with three or more bedrooms and are used by a family
of two or more. Hence families requiring the solar homes are also its customers. Those who are
above 55 years of age, they are generally found as the biggest purchasers of solar powers13.
Technological: The concept of solar photovoltaics (PV) has grown in popularity only in
the recent few years. The contribution of solar products is still very minimal to the world energy.
Additionally, the technology is even costlier than the fossil fuels. The technologies used in
producing solar products needs to be cheaper. It needs to be the one fourth of the existing price.
This is the one way it can be expected to dominate the fossil fuels across the worldwide
countries14. The latest technology which is believed to be as a revolution in the making of solar
products has been found. Actually, a material named perovskite has been found in the earth-
abundant precursors. The investigation for the same products had started around 2009. However,
11 Krasner, Stephen D. "State power and the structure of international trade." World Politics 28, no. 3 (1976): 317-
347.
12 Samad, Hussain A., Shahidur Khandker, M. Asaduzzaman, and Mohammad Yunusd. "The benefits of solar home
systems: an analysis from Bangladesh." (2013).
13 Eggers-Lura, Aldo. Solar Energy in Developing Countries: An Overview and Buyers' Guide for Solar Scientists
and Engineers. Vol. 1. Elsevier, 2013.
14 Park, Nam-Gyu. "Perovskite solar cells: an emerging photovoltaic technology." Materials Today 18, no. 2 (2015):
65-72.

5
TRINA SOLAR STRATEGIC ANALYSIS
the revolution was brought up in 2012 when perovskite was proven as an excellent
semiconductor. The revolution means that PV cells can be made of thin layers in a simple stack.
This was believed as a potential find for revolutionizing the manufacturing enormously.
Moreover, this was also believed as to deliver a much enhanced efficiency15. One of the
advantages of perovskite is a fact that it is cheap to synthesize. Moreover, high-quality films can
possibly be processed from solution at fewer temperatures. This makes it compatible with the
existing manufacturing techniques which are quite simpler also. Perovskite can be easily
tweaked making it easier to create a material which can effectively absorb the visible light of any
frequency. This was not realizable earlier with the silicon as it can only absorb light within a
specific range of wavelengths. This also put a limit on the efficiency of the device16.
Environmental: Environment sustainability is a critical concern for global countries. The
criticality is evident from numerous governing schools like the Paris Agreement which is
intended to fight against the rising pollution17. There are few substances which are seriously
harmful to the environment. Greenhouse gas (CO2) is one of those which have severely
impacted the surrounding environment. The United States of America is one of the countries
with a very high rate of CO2 emission18. In fact, the global world is worried about the
greenhouse gas emission. The dependency of larger industries on CO2 emitting resources has
worsened the situation. The larger industries across the global world have also identified the
benefits of switching over to renewable energy resources. Solar being one of the renewable
energy resources is a very useful alternative to coal and other non-renewable energy resources19.
Solar energy is a good prospect for the United States considering a fact that it contributes to a
high extent in increasing the CO2 content in the air. This is also the reason why the Federal and
state government have supported the production of renewable energy resources20. The move had
also supported the use of solar energy as the possible replacement for coal and other non-
renewable forms of energy. Solar products are beneficial also as these products emit no CO2
which is very important for reducing the air pollution. This can be used as a replacement for a
power generator. Hence, customers will be freed from paying bills for electricity21. These are the
few prospects that give a boost to the use of solar panels in the United States of America.
However, the recent announcement being made by Trump on imposing the trade tariffs on
imported solar products may seriously affect the industry. It is expected to influence the price of
15 Jean, Joel, Patrick R. Brown, Robert L. Jaffe, Tonio Buonassisi, and Vladimir Bulović. "Pathways for solar
photovoltaics." Energy & Environmental Science 8, no. 4 (2015): 1200-1219.
16 Park, Nam-Gyu. "Perovskite solar cells: an emerging photovoltaic technology." Materials Today 18, no. 2 (2015):
65-72.
17 Riahi, Keywan, Detlef P. Van Vuuren, Elmar Kriegler, Jae Edmonds, Brian C. O’neill, Shinichiro Fujimori, Nico
Bauer et al. "The shared socioeconomic pathways and their energy, land use, and greenhouse gas emissions
implications: an overview." Global Environmental Change42 (2017): 153-168.
18 Linquist, Bruce A., Merle M. Anders, Maria Arlene A. Adviento‐Borbe, Rufus L. Chaney, L. Lanier Nalley, Eliete
FF Da Rosa, and Chris Kessel. "Reducing greenhouse gas emissions, water use, and grain arsenic levels in rice
systems." Global change biology 21, no. 1 (2015): 407-417.
19 Chen, Daming, Weiwei Deng, Jianwen Dong, Feng Ye, Huijun Zhu, Hui Li, Yuling Jiang et al. "21.40% efficient
large area screen printed industrial PERC solar cell." CELL37 (2015): 80-34.
20 "Solar Power (US) - Industry Research Reports | Ibisworld". 2018. Ibisworld.Com.
https://www.ibisworld.com/industry-trends/market-research-reports/utilities/solar-power.html.
21 Martinez-Anido, Carlo Brancucci, Benjamin Botor, Anthony R. Florita, Caroline Draxl, Siyuan Lu, Hendrik F.
Hamann, and Bri-Mathias Hodge. "The value of day-ahead solar power forecasting improvement." Solar
Energy 129 (2016): 192-203.