Starting from April 2021, the supply of raw materials such as IGBTs is very tight, which makes China's inverter manufacturers a strong seller.

Many inverter manufacturers have told us that there is no need to open up the market because of the surge in inverter orders, as the current production capacity cannot even meet the orders of old customers. For new buyers, inverter manufacturers no longer accept orders because companies are simply too busy. If it is a small customer who has not cooperated before or has little cooperation, it is impossible to win the favor of inverter manufacturers.

The biggest worry for inverter manufacturers now is that they cannot meet the needs of all customers and are forced to classify customers and select orders. This is not a good phenomenon, because any industry has volatility. If the customer relationship cannot be handled well now, the manufacturers will be very painful when the inverter market enters the freezing period.

Generally speaking, the sales model of inverter manufacturers includes three categories: the first is direct sales, including system integrators, EPC contractors and installers, investment owners, etc. (such as ground power stations, households, and industrial and commercial).

The second category is the distribution category, which is carried out through channel agents. Simply put, inverter manufacturers sell the goods to these agents, and the agents sell them to the end customers.

Among the medium and large inverter manufacturers, there are some that do ODM-without their own logo brands, they are sold directly to customers, and the latter are integrated into a complete set of power station equipment and sold to end users. Generally speaking, the overall sales of ODM will be lower than the sales of private brands, but why do inverter manufacturers still want to do it? Although it does not contain its own logo, most products will get a gross profit margin of more than 30%.

At present, in terms of ODM cooperation methods, some inverter manufacturers are not taking orders, because the output of their own brands cannot fully satisfy existing customers.

When can this situation be alleviated? We must realize that in addition to the normal growth of the market, the biggest reason for the current situation is the serious shortage of products such as chips and IGBTs. During the pandemic, chip manufacturers did not produce large-scale production, which led to an overall shortage of stock in the electronics industry in the second half of last year. Although the epidemic is now under certain control, and chip manufacturers are also producing at full capacity, these positive effects may not appear on the market's terminals until next year.

In theory, the supply of chips next year will be relieved to some extent, so can the shortage of inverters be fundamentally changed? With the advancement and realization of carbon reduction goals, the demand for distributed power stations such as lithium batteries, photovoltaic PV, wind power generation, etc. will increase substantially. In this market context, inverters will still become in short supply.

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