Nanosolar Inc.

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Nanosolar, Inc. - Case Solution
Case Problem
Martin Roscheisen, CEO of Nanosolar must decide on the market they are going to focus, whether it’s Europe which has feed-in tariff plans with long term commitment (20 yrs) or jump-start into the nascent but high potential US market. The other problem plaguing him is the pricing and sales strategy to be employed. A low-pricing strategy is imperative for the US market as there are many players in it, as for Europe having a reliable pricing schedule- it’s all about pricing vis-a-vis its major competitor First Solar.
Sales Strategy
The major markets for Nanosolar is going to be Europe and US, and in the long-run they have to go for the emerging economies which promises immense potential.
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default market to be targeted by Nanosolar
* France is committed to renewable energy source, with the government setting a target of 20% of all energy source to be renewable by 2020 * There is also a stable feed-in tariff (being backed by the government for 20 yrs) of $0.42/kWh * Taking into account a 1% (CPI in year 2008) decline year-on-year, we have an average tariff of $0.38/kWh * But the market size remains small, with a meagre potential of 300MW by 2011
* It also has feed-in tariff (modelled on Germany’s) of $0.59 for 20 yrs and declining annually at 2% * This makes an average tariff of $0.49/kWh which is higher than the others * Moreover the market potential is said to reach 3GW by 2016, this market is very lucrative and should definitely be a potential target
United States Market * The major issue with the US market was the lack of a national framework for feed-in tariff, but many states has recently come up with their own policy * Florida came up with a feed-in tariff plan of $0.32/kWh for 20 yrs, but the most significant incentive for the manufacturers is the 30% tax credit given by the government * This along with other federal support (such as loans and rebates) provides the much needed push in the high potential market * With the effect of carbon tax set to increase the cost of other energy sources, solar power will become a more viable option in the future * Thus even though the short-term
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