Exclusive Interview with Philip Zheng:
Solar Power and Doing Business in Thailand
General Manager of Canadian Solar
In this interview, Philip Zheng, General Manager of Canadian Solar in Thailand, Vietnam, and Indonesia, discusses solar power as well as industry-leading company Canadian Solar. As a global company that has diversified into Southeast Asia in recent years, Canadian Solar has helped transform Thailand into a solar power hub. Read on to learn more about the company and the future of solar power.
What is Canadian Solar all about?
Canadian Solar is 20 years old, originally founded back in Canada. Throughout these 20 years we have already developed ourselves into a global leader in terms of solar energy equipment manufacturing, developing, and providing service. We have positioned ourselves globally to provide not only solar equipment such as solar modules and solar inverters, but also as one of the largest global companies in terms of solar project development, and solar project development. We also try to do Engineering, Procurement, and Construction (EPC) for solar related projects for third parties. For example, if someone wants to install something on a rooftop, especially the commercial or industrial kind of scale, Canadian Solar can give you an engineering design and help you with construction. At Canadian Solar also help people with maintenance of their solar farms and commercial industrial rooftop systems.
How did you get involved with the company?
I joined Canadian Solar more than five years ago, when we started our Thailand project. This project is the biggest single investment in terms of a manufacturing site for Canadian Solar. As time has gone by I have come to take care of not only Thailand, but also our branches in Vietnam and Indonesia as General Manager.
Why did Canadian Solar decide to do business in Thailand?
We are a Canadian company, but with global reach; we have a lot of factories across the globe, back in Canada, as well as in China, Vietnam, Thailand, Indonesia, and Brazil. We have a lot of offices and engineering teams across the globe to not only develop but also maintain and operate our solar projects. We are constantly looking at where we should go to diversify our business and better support our customers, so we came to Thailand seeking diversification. We also understood that Thailand is centre and hub of manufacturing in Southeast Asia. It is located in the middle of the region, which is very important in terms of logistics and the flow of goods and people. Thailand’s Board of Investment (BOI) also offers incentives for businesses to come to Thailand, and with a well-educated workforce, which is quite important for a technology company, Thailand was an attractive choice for a manufacturing hub and facility; we came to invest heavily to have our factories built up here.
How has the Covid-19 pandemic impacted Canadian Solar?
Covid-19 has brought a lot of difficulties to our company in several aspects. Since our business relies heavily on the global supply chain, we try to source our material from neighbouring countries like Malaysia, Vietnam, and China, and we try to sell our products mainly to the American, Canadian, Japanese, and European markets. Naturally there are lot of problems; logistically it becomes very difficult to manage. If we need to get something, for example from China, and we have to deal with whether our suppliers can manage to operate and produce the goods we need on time. Logistically, whether they can ship it out on time or not is another aspect. We have faced almost triple our projected cost because of the container shortage; containers are going to one country and then cannot go back due to regulations, so there is a disruption. This shortage of containers has shot up prices like crazy. In the past we may still have had some other options; for example we could ship the goods into Vietnam and then bring them into Thailand. Due to the Covid situation however, different countries have different border controls and regulations now, so we have faced a lot of difficulties in this sense.
In general, we are still working fine in Thailand because we are still a manufacturing-based business here, so long as our supply chain can still manage, our workforce can be managed. The global solar market is still doing very well, because people are continually realizing that renewable energy is important, so the market is going up and business-wise we are doing quite well globally.
What would you say to someone thinking of investing in Canadian Solar?
In terms of industry, solar power is the most important renewable energy in the world right now. Every year since 2000, the global solar market has grown. In terms of individual countries, there has been fluctuation, but globally the investing power of solar power has never decreased. That shows how much people love solar power. In the past, people have had the perception that solar is good because it is green, but bad because it is expensive. Now, I am proud to say that solar power is actually one of the cheapest energy sources in the world. People are using solar power because they have an understanding of global warming, climate change, but increasingly it is also more and more affordable.
Being in this industry, Canadian Solar is proud to be doing something which is helpful for everyone globally, so that we can help countries combat climate change by providing this cheap energy source. We are also one of the leading companies in terms of technology, often launching our latest products to help to reduce electricity prices. Last year we recorded three world records of solar conversion efficiency of our solar fields. We are also one of the biggest solar farm developers globally and are doing quite well as a company because of this. We are a strong company and part of a booming industry; for these reasons I believe that people should look at this as an opportunity to invest in solar energy and Canadian Solar in particular.
What makes Thailand a valuable place to do business?
Thailand is very strategically located. It is in the centre of Asia, so it is very easy for us to source materials from surrounding countries and the supply chain tends to flow into this region naturally. By relocating into this region, it is possible to bring down business costs for manufacturing companies like us because of the supply chain management and low operating costs. We have a great seaport here in Thailand called Laem Chabang, which is one of the top 20 globally. Logistical operation costs are also much lower in Thailand compared to other countries in the region. When we wanted to set up companies in the region for our biggest investment, we surveyed many countries but finally found that Thailand was the most attractive for us for these reasons, and the government incentives, such as tax holidays from the Board of Investment were also reasons to choose to invest and build our business in Thailand.
What do you think the future holds for the company?
We definitely would like the situation to become better with Covid, because it will free up people to go out to and meet people, talk about our business, and to share experiences about the solar energy or solar systems they are using. In terms of a global market, we see two very different scenarios: on one hand, huge solar farms, usually in the middle of nowhere—those projects are quite isolated and thus not really affected by Covid, the construction is able to continue and there is not too much concern. On the other hand, commercial and industrial projects, such as big shopping malls and factories—if people want to install something on those rooftops, these sorts of projects face some problems because people cannot go to share their ideas, go see the project, and talk about it. In this sense, we definitely would like the situation Covid situation to improve so that we can have discussions and further promote solar usage.
What do you like about working for Canadian Solar?
I have been working for Canadian Solar for more than five years, and I always notice that we are a Canadian company, but with global reach, so it is quite internationalized. For example, in Thailand in our manufacturing base, the majority of our workforce is from Thailand, but we also have many different employees from many different countries. Personally I am from Singapore; we have Singaporeans here, we have Malaysians, Filipinos, Chinese, Americans, and so on. Even in Thailand, at our manufacturing centre we have lots of diversity here. Globally, we have almost 20 manufacturing sites, in fact we have close to 40 offices globally. We have hired people of almost 40 nationalities to our workforce, so it is a very diversified place. If you join some of our internal meetings, you may even notice that before Covid we usually have global meetings where people fly in from all over the world; people share their stories and exchange their ideas about what they do in their part of the world and how they use solar in their particular kind of a scenario. It is the diversity and inclusion that makes Canadian Solar a great place to work.
What are you most proud of working for Canadian Solar?
Before Canadian Solar came into Thailand to invest, there was no solar technology development in the region. In terms of manufacturing and technology development, we faced some problems when we first came to Thailand because there were engineers and a strong workforce, but there were no people who knew about this specific technology or industry. After 5-6 years, we trained the whole workforce and brought in the latest technology, to serve the premium markets like the US, Canada, Europe, and Japan. We produced the latest technology products here in Thailand, we trained the workforce, and now Thailand is considered one of the largest producers of solar products—even bigger than the USA. Since we are so big and we have invested so much in Thailand, we have also demonstrated that Thailand is the place to go. Our competitors also have come into Thailand; we gave them confidence that Thailand is a place you should also go to for business. We welcome competition, because it will also bring up the whole industry in Thailand, so that years down the road it will be quite a reasonable industry for Thailand as a whole. I am proud of how far we have come with Canadian Solar in Thailand as industry leaders and innovators.
Author: Samantha Rae Harriss