The U.S. International Trade Commission (USITC) has triggered a fierce debate over the timing of tariff implementation, rate structures, and industrial impacts following its final ruling on alleged solar product injury from four Southeast Asian nations (Cambodia, Malaysia, Thailand, Vietnam).
The Solar Energy Manufacturers Association (SEMA) and allied groups have urgently demanded USITC to finalize tariff details by June 2 at the latest. Their concern stems from a U.S. Customs procedural loophole: if USITC delays its decision beyond this date, importers could still clear shipments duty-free or under existing low rates (some products exempt) within 90 days of the announcement. SEMA warns this could flood the U.S. market with billions of dollars’ worth of Southeast Asian modules before new tariffs take effect, further eroding margins for domestic manufacturers already struggling with sub-50% capacity utilization despite Inflation Reduction Act (IRA) tax credits.
The USITC’s proposed duties range from 34% to 3521% across companies:
- Cambodia: A 3521% penalty rate was imposed on firms accused of “systematic circumvention” after refusing to cooperate with investigations.
- Vietnam: Undisclosed companies face a nationwide 395.9% tariff.
- Thailand/Malaysia: Average rates stand at 375.2% and 34.4%, respectively.
- Chinese solar giants with Southeast Asian operations face steep tariffs: JinkoSolar’s Vietnam modules face 245%, while Malaysia-produced items incur 40%; Trina Solar’s Thailand modules are taxed at 375%, with Vietnam rates exceeding 200%; JA Solar’s Vietnam components face ~120%.
U.S. manufacturers like Hanwha Q CELLS and First Solar, whose stock prices rose 1.4% post-ruling, applaud the move. First Solar’s legal counsel termed it “a pivotal step in rebuilding domestic supply chains,” citing capacity utilization below 50% despite IRA subsidies.
However, the American Clean Power Association (ACP) cautions that Southeast Asia accounts for 77% of U.S. module imports. Duties could inflate project costs by 15–30%, delaying President Biden’s 2035 grid decarbonization goal. Developers highlight that while modules account for only 10–15% of project budgets, tariff-induced supply chain volatility risks exacerbating interconnection delays.
The tariffs are seen as an extension of the U.S. “friend-shoring” strategy to curb Chinese firms’ use of Southeast Asian hubs for tariff evasion. China’s Ministry of Commerce previously criticized the U.S. for abusing trade remedies, warning of elevated global green transition costs. Analysts predict a surge in Southeast Asian module imports during Q3 2025 if USITC fails to close the procedural window, further distorting market dynamics.
