(Yicai Global) June 7 -- Tongwei and Longi Green Energy Technology, the world's largest suppliers of high-purity polycrystalline silicon materials and monocrystalline solar wafers, respectively, plan to spend a combined CNY23 billion (USD3.2 Billion) balancing their industrial layouts by expanding production capacity in the middle and lower streams of the supply chain.

Tongwei intends to build solar cell and panel plants in its home city of Chengdu with a total fixed asset investment of CNY10.5 billion (USD1.5 billion), it said in a statement late yesterday. Longi announced the same day that it will invest CNY12.5 billion to build solar silicon rod and battery production plants and a global innovation center in Xi’an, where it is headquartered.

Solar silicon and wafer prices have been falling since the beginning of the year, sparking concerns about overcapacity. But Tongwei and Longi, the industry’s upstream giants, have decided to expand battery and panel production to better balance their business.

Tongwei's new plants will be constructed in two phases, the firm said. The first will build a solar cell factory with an annual output capacity of 25 gigawatts, to be completed and put into operation by the end of next year. The second will build a solar panel plant with an annual output of 20 GW. It should start production by the end of 2025.

The project will improve Tongwei's comprehensive competitiveness and provide more cost-effective products for its supply chain partners and end users, the company added.

Longi's new project will be also built in two phases. The first will build a monocrystalline silicon rod plant and a battery factory with 20 GW and 12 GW output per year, respectively, the firm said. The second phase will double the capacity of the battery plant. There might be a third phase, if deemed necessary.

Longi also plans to build a global innovation center, which is expected to become operational by December 2025.

The project will optimize the company's capacity layout in the photovoltaic energy supply chain, make full use of its integrated competitive advantage, and improve profitability, Longi pointed out.

Editor: Futura Costaglione