The latest wave of U.S. trade tariffs on Malaysian solar imports is threatening to drive Chinese-owned solar panel manufacturers out of the country, according to the Malaysia Photovoltaic Industry Association (MPIA).
“Some of these manufacturers were already on life support,” said MPIA president Davis Chong, referring to the earlier round of U.S. duties that nearly crippled their Southeast Asian operations. “This latest move could finish the job.”
Malaysia exported RM37.4 billion worth of photovoltaic (PV) products in 2024, with the United States accounting for RM12.5 billion, or 33.4%, of that total, according to the Malaysia External Trade Development Corporation (Matrade). While significant, this marks a decline from 2023, when U.S.-bound exports hit RM16.1 billion. These figures include products from both Chinese and U.S.-owned firms operating within Malaysia, such as Arizona-based First Solar Inc.
The new tariffs add to the pressure. On October 1 last year, the U.S. imposed a sweeping 9% tariff on Malaysian solar cell imports, which make up 14% of America’s supply. Five companies were singled out for duties ranging from 3.4% to a staggering 123.94% — including China-backed JinkoSolar Holding Co Ltd (3.47%) and Baojia New Energy (123.94%).
An additional 8.59% anti-dumping and countervailing duty (CVD) has since been levied against Malaysia — the lowest among four affected Southeast Asian countries. However, individual firms were hit harder, with some slapped with rates as high as 81.24% due to non-compliance during investigations.
The fallout is already visible. Longi Green Technology Co has paused its expansion plans across its three Malaysian plants, while Risen Energy Co has scaled back production. JA Solar Technology Co ceased operations entirely in 2023.
“More Chinese solar panel manufacturers are expected to exit Malaysia,” Chong said. “We believe many factories have already begun relocating to countries outside Southeast Asia. The new tariffs might be more of a final chapter than a turning point.”
Despite the manufacturing shake-up, Malaysian solar project developers remain largely unaffected. Firms like Solarvest Holdings Bhd and Samaiden Group Bhd, which rely heavily on China-sourced panels, expect no earnings impact. Oversupply in the global solar market continues to keep prices low, with PV modules trading below US$0.10 per watt — a silver lining for local installers.
Samaiden’s managing director Chow Pui Hee dismissed the likelihood of fire sales unless factories are liquidating inventory before shutdown. “Unless manufacturers can price competitively with China, they’ll struggle to sell locally,” she said.
Analysts at TA Securities echoed this, predicting only a “mild impact” from short-term overcapacity. They anticipate a neutral outcome for publicly listed local solar players.
While the direct economic toll remains uncertain, the RM12.5 billion in solar PV exports to the U.S. accounted for just over 2% of Malaysia’s total RM601.2 billion in electrical and electronics exports last year. Some firms have also benefited from tax holidays and incentives — a cushion against the full brunt of the tariffs.
As the dust settles, one thing is clear: global oversupply is keeping prices low, but geopolitical tensions are reshaping where and how solar products are made — and who gets to stay in the game.
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