The Opportunity

Universal Solar Americas SA, the manufacturing arm of Universal Solar LLC, based in Panama Free Trade Zone, recognized a significant opportunity in the global solar power market. This market, with a size of USD 197.23 billion in 2021 and expected to grow at a robust CAGR of 7.2%, presented an ideal landscape for Universal Solar to establish a localized supply chain in the United States.

However, several challenges within the industry, including global supply chain disruptions, sourcing delays, and escalating costs, needed innovative solutions. Universal Solar aimed to address these issues by strategically situating its manufacturing facility in Panama to offer shorter procurement times, reduce costs, and bypass political barriers.

Key Challenges

Our Approach

To address these challenges and capitalize on the opportunity, Universal Solar Americas SA adopted a multifaceted approach:

Developing a Compelling Investment Opportunity: Universal Solar established a manufacturing facility in Panama, strategically located for quick shipments to major U.S. ports. This localization resulted in procurement shipping times of 5-10 days, outperforming competitors by 60-70 days. Furthermore, Panama's coverage under the Trade Promotion Agreement (TPA) exempted Universal Solar from AD/CVD tariffs and other barriers to the U.S. market, effectively lowering U.S. solar project costs.

Reducing Costs and Offering Financing Options: By manufacturing its own products and procuring raw materials strategically, Universal Solar could offer products at a lower cost compared to competitors. The company also provided financing options through its strong relationships with major investment groups and global financiers.

Co-Development and Advanced Products: Universal Solar differentiated itself by offering co-development services, including project coordination, site analysis, financial analysis, and design & engineering. Additionally, its products boasted higher quality, better performance, and greater reliability compared to competitor products.

Developing an Execution Strategy

Universal Solar Americas SA's manufacturing facility, situated over 75,000-80,000 sq. ft. in the Panapark Free Zone, Panama, was designed for rapid operation. The facility initially possessed a production capacity of 500 MW in Phase 1, later expanding to 1 GW in Phase 2. The modules ranged from 370 - 400 KW (residential) to 450 - 500 KW (commercial).

The company prioritized sustainability by partnering with the CRB Group to incorporate renewable energy, reduce HVAC demand, and implement on-site energy storage. This focus on the three pillars of sustainability - People, Planet, and Profit - aligned with evolving corporate social responsibility (CSR) trends.

Universal Solar America LLC, with its established presence in the United States, served as a vertically integrated sales office, pursuing new leads and creating business opportunities for the Panama-based manufacturing facility. The US-based sales team leveraged the company's reputation as a solar consulting, development, and procurement firm.

Conclusion

Universal Solar Americas SA successfully navigated the challenges posed by the global solar power market. Through strategic localization, cost reduction, and a commitment to sustainability, the company carved out a unique position in the industry. Its investment in a Panama-based manufacturing facility and transparent business practices laid the foundation for a promising future in the solar energy market. This case study demonstrates how Universal Solar's innovative approach addressed industry challenges and capitalized on a lucrative opportunity, showcasing Avvale's expertise in driving transformative business solutions.