The other day, I quoted a NY Times article about Chinese production of solar panels as saying:
Even with Suntech acknowledging that it sells below the marginal cost of producing each additional solar panel — that is, the cost after administrative and development costs are subtracted — any antidumping case, in the United States, for example, would have to show that American companies were losing money as a result.
Then in a comment on the post (in response to a related point), I said:
What interested me about the anti-dumping point was the statement that "Suntech acknowledg[es] that it sells below the marginal cost of producing each additional solar panel." I'm not sure what this means exactly, but I couldn't help thinking, why would Suntech admit this given the possibility of an anti-dumping action?
Apparently I was not the only one who noticed this. The Times has another article today with a correction of sorts:
Shi Zhengrong, the chief executive and founder of Suntech Power Holdings, said in a telephone call Wednesday that he had misunderstood the question when he said twice in a recent interview that his company was selling panels in the United States below the marginal cost of producing each additional unit.
...
He said the price that Suntech charged for each solar panel more than covered the production costs and therefore was above the marginal cost. But the administrative costs of running the subsidiary are fairly high on a per-module basis because the company is still building sales. The marginal cost of selling manufactured goods is the cost of producing one additional unit — typically the incremental cost of materials, assembly and shipping — excluding virtually all administrative costs.
...
His revised remarks underlined the attentiveness of Chinese solar panel makers to complaints from Western manufacturers about China’s lower prices and rising market share.
Clearly, this is a sensitive issue!
