Suntech Power Holdings Co. Ltd is a Chinese based company producing Solar Panels. In 2010, a new factory of Suntech opened in Arizona, USA, but closed in 2013(Reuters). Using solar panels is considered as a recyclable way to provide electricity, and it is widely used among different groups of customers from the whole market (residences, fuel companies, etc.)

So how could this happen?

By looking at news related to Suntech, it is obvious that, after the financial crisis in 2008, most of  buyers delayed their orders, which led to overproduction in the factory. This caused an increase in operating costs and more spending on storing the products as well as equipment maintenance(Suntech Financial statement for 2011).

The US government also imposed a nearly 250% anti-dumping tariff on Suntech as this company was confirmed to sell products at price much lower than their production costs(TREFIS). Such tariff made it hard to cover costs by total revenue and achieve the business main goal: Profit maximization.

I think it is hard for Suntech to recover from this downturn. The debts that Suntech needs to take are extremely high, which leads to a bad reputation of the company. Even if Suntech wants to rebuild its reputation, it will take a long time to remove all the bad images.Furthermore, because of the failure of Suntech, customers  lost confidence to the company and eventually, they will turn to buy the substitute goods–Wind Power products(Advantages for wind power).