American Superconductor Corp (NASDAQ: AMSC) has formed the division “AMSC China” to serve the growing wind energy, power grid and industrial markets in China.
The company recently received an enterprise business license from the Chinese government to form a Wholly Foreign Owned Enterprise in Suzhou National New and Hi-Tech Industrial Development Zone (SND), located 80 kilometers west of Shanghai. The business license allows for domestic manufacturing and sales of AMSC’s power electronics and superconductor products.
AMSC also has expanded its sales and field service office in Beijing to support and grow its business in China and the broader Asia-Pacific region. “With its rapidly growing economy and increasing energy demands, China has become a key target market for AMSC in recent years,” said Greg Yurek, AMSC CEO. “Today, approximately half our revenues are coming from the Asia-Pacific region, with China accounting for the largest fraction of those sales. By serving these markets locally, we believe we will foster stronger ties with our current customers and more rapidly develop new customers in the region. We also expect to be able to reduce costs for standard products like our PowerModule” power converters by locally sourcing, assembling and testing certain non-proprietary components.”
AMSC’s PowerModule product is a programmable, scalable power converter that uses a proprietary printed circuit board design, which allows the use of standard electronic manufacturing techniques for consistent, automated product assembly. It is one of the core electrical components AMSC is selling to wind turbine manufacturers in China and the Asia-Pacific region.
Since introducing the PowerModule product in 2004, AMSC has produced and shipped more than 1,500 of these units from its Wisconsin operations. A majority of AMSC’s PowerModule converters are being sold in China today.
AMSC is also expanding U.S. operations in Wisconsin and Pennsylvania, where it produces next-generation PowerModule power converters as well as its D-VAR®, PQ-IVR” and Static VAR Compensator power grid and industrial power quality offerings.
“We have been expanding our operations in the U.S. to meet the growing demand for these products,” said Yurek. “In time, we expect to also begin producing these higher power systems in China to recognize additional cost savings and better serve the local utility, industrial and wind markets. The need for D-VAR, PQ-IVR and SVC solutions in the Asia-Pacific region is quite significant, and AMSC China will serve as our channel into this market. At the same time, we will take the steps necessary to protect our intellectual property, including maintaining production of the encrypted control cards for these systems in the United States.”
AMSC said it expects to expand sales of its products beyond the wind energy market in the Asia-Pacific region. In the industrial sector, the company recently announced that a semiconductor chip manufacturer placed an order for AMSC’s PQ-IVR system for one of its large wafer fabrication facilities in Southeast Asia.
In the electric utility market, AMSC formed a strategic business alliance with Shanghai Electric Cable Research Institute (SECRI), which is one of two Chinese entities that certify all new power cable technology for China. This alliance is aimed at developing and promoting the use of high temperature superconductor (HTS) power cables in China to help transmit and distribute increasing quantities of electric power needed to support the growing Chinese economy.
“We believe our business alliance with SECRI will soon lead to a successful prototype HTS power cable and that this will be the precursor to an in-grid demonstration in China in the next few years,” said Yurek. “China represents a significant market for our HTS wire and AMSC China will play a key role in developing this market. We believe this same strategy can be replicated in other countries.”
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