Reply #2: If you mean intentionally cutting production like OPEC to control prices...

[FBaggins]

...then it may "sound" that way, but it isn't.

The contagion that has been killing solar companies in the West has spread to China. Few of the companies are strong enough right now to manipulate the market in that specific way. You just eventually get to a point where you have so much supply built up in the warehouse that when orders don't increase as you had hoped... you just can't afford to keep running the line.

It will all shake out eventually, but it's an ugly time in the sector right now.

Take, for instance, the largest producer of solar wafers in the world (LDK). They just had their quarterly report a couple weeks ago. Their cash (etc) on hand fell by over half to about $250 million... while their debt grew to almost ten times that level and they have a negative cash flow.

Were they not in China's version of "too big too fail", they would likely be bankrupt.