According to a research report from China Merchants Securities, Elon Musk stated at the Davos Forum that Tesla and SpaceX plan to establish 100 GW of solar manufacturing capacity each in the United States within three years. This round of solar capacity expansion in North America is expected to lead to a revaluation of related domestic auxiliary material suppliers, equipment manufacturers, and leading production companies. Particular attention should be paid to opportunities in auxiliary materials, which offer strong sustainability and minimal divergence in technology pathways. Among these, ground-based auxiliary materials present high certainty, while space-based auxiliary materials hold substantial market potential. Additionally, certain companies holding core patents in the main supply chain are also poised to benefit. Key views from China Merchants Securities are as follows:

Elon Musk indicated at the Davos Forum that Tesla and SpaceX will each build 100 GW of solar capacity in the U.S. within three years. North American ground-based capacity expansion is expected to adopt mature Chinese technology routes and auxiliary material supply chains. In contrast, space-based equipment and auxiliary materials require specialized development and design, with significantly higher value than ground-based applications.

The North American solar expansion will drive a revaluation of related domestic auxiliary material suppliers, equipment makers, and leading manufacturers. Emphasis should be placed on auxiliary material opportunities due to their strong sustainability and limited technology pathway disagreements.

North America is set to initiate a solar manufacturing capacity expansion. Tesla and SpaceX have repeatedly expressed plans to build hundreds of gigawatts of local solar capacity over the next three years. Stimulated by tariff protections and FEOC subsidies, eligible North American solar production capacity is expected to achieve substantial excess returns.

In recent years, new solar installations in the U.S. have continued to grow, with projections of 40-50 GW by 2025. Considering natural growth and future demand from data centers, ground-based solar in North America could support demand on the scale of hundreds of gigawatts. Although current photovoltaic demand from low-orbit satellites is small, it is growing rapidly, suggesting that space-based solar could evolve into a major market.

North American ground-based solar will create opportunities for the relevant Chinese supply chain, while space-based solutions are still iterating. Industry feedback suggests that SpaceX's current approach may favor the P-HJT route, with perovskite and perovskite tandem cells also under active consideration. HJT and perovskite equipment manufacturers are expected to benefit. Furthermore, the complex space environment demands higher requirements for ultra-thin silicon wafers and module packaging.

For ground-based solar in North America, N-type TOPCon may be chosen for economic reasons. However, since patents and processes are held by Chinese companies, those possessing core TOPCon patents are likely to share in the benefits. Additionally, Tesla has publicly stated its intention to expand production starting from raw materials, indicating that wafer and polysilicon equipment suppliers may also benefit.

The ground-based auxiliary material chain offers high certainty and greater sustainability, while space-based auxiliary materials are expected to see significant inflation and possess considerable future potential. Tesla's SolarCity has long collaborated with domestic auxiliary material companies, and its ground-based solar expansion is likely to utilize the existing supply chain. Due to FEOC restrictions on the Chinese supply chain, lightweight auxiliary materials such as paste, film, and junction boxes may gradually be localized in North America. Companies with mature overseas production capacity for glass and frames will gain a first-mover advantage.

Given the extreme conditions in space, space-based auxiliary materials require substantial upgrades and may experience significant cost inflation. UTG glass/CPI film and silicone are critical encapsulation materials, with long-term market potential potentially reaching hundreds of billions of yuan. Metallization for crystalline silicon routes relies on paste, with both volume and processing fees far exceeding those for ground-based applications. Companies with relevant patents and historical cooperation experience are well-positioned to benefit.

Risks include slower-than-expected development of commercial/space computing power, technology pathway iterations, and geopolitical risks.