JA Solar Holdings Co., Ltd. (ADR) (JASO), Yingli Green Energy Hold. Co. Ltd. (ADR) (YGE), GT Advanced Technologies Inc (GTAT): China Continues to Give Away Solar

But when I talked to GTAT’s CEO last year, he said Chinese companies simply don’t have the money to buy new equipment. Demand was coming from the Middle East, the U.S., and Europe, where new entrants are trying to build the next generation of solar equipment.

If Chinese solar manufacturers are selling products below cost now, what will they do when more efficient products hit the market? Eventually, even a free panel wouldn’t be worthwhile to installers because the added efficiency is worth the cost. In an article late last year, I highlighted why cost matters less as efficiency improves.

Foolish bottom line
The latest earnings reports are another data point showing why investors should avoid Chinese solar. Just because China keeps dumping money into these companies doesn’t mean you should. They’re on the wrong side of the industry, and their strategic position is only getting worse.

The article China Continues to Give Away Solar originally appeared on Fool.com.

Fool contributor Travis Hoium and The Motley Fool have no position in any of the stocks mentioned.

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