“Race to the bottom" — Phrase of the Week
Some of China’s biggest solar companies agree to stop the destructive competition on price
Our phrase of the week is: “race to the bottom” (卷价格 juǎn jiàgé)
Context
China’s solar industry is under pressure, say the founders of some of the country’s biggest photovoltaic (PV) manufacturers.
This is one of the main messages coming out of the International Photovoltaic Power Generation and Smart Energy Conference & Exhibition (国际太阳能光伏与智慧能源大会暨展览会), the SNEC, held in Shanghai from June 13 to 15.
Now in its 17th year, the SNEC is the world's largest PV event, showcasing the latest advancements in PV and related technologies. It attracted over 3,000 exhibitors from 95 countries in 2024.
According to conversations around this year’s SNEC, huge changes have happened to the solar industry since the last SNEC in 2023: production capacity has tripled, and profit margins are down by around 70%.
This has created a highly competitive environment, according to one of China’s most successful solar entrepreneurs, Zhū Gòngshān 朱共山, the chairman of GCL Group (协鑫集团)
“PV is our passion, our business and our conviction.
Of course, we need to compete in the market, but we should not compete at all costs to a point that we do not make any profit, that we undercut the market, and leave no way out for ourselves.
Let's stop the race to the bottom!”
光伏是我们的情怀所在、事业根本、信仰托付。卷是市场常态，但我们不能赢了面子，输掉裤子，把行业卷坏，把自己卷死。咱都别卷价格了！
Guāngfú shì wǒmen de qínghuái suǒzài, shìyè gēnběn, xìnyǎng tuōfù. Juǎn shì shìchǎng chángtài, dàn wǒmen bùnéng yíngle miànzi, shūdiào kùzi, bǎ hángyè juǎn huài, bǎ zìjǐ juǎn sǐ. Zán dōu bié juǎn jiàgé le!
And with that we have our Sinica Phrase of the Week.
What it means
“Race to the bottom” is how we translate the three character phrase: “involuted” (卷 juǎn), “price” (价格 jiàgé).
The character “involuted” (卷 juǎn) is a verb which is part of the two-character noun, “involution” (内卷 nèijuǎn).
“Involution” has become a common phrase in China in recent years. In 2020 it was voted one of the top internet phrases of the year by the magazine, Yanwen Jiaozi 咬文嚼字.
It was first coined by the American anthropologist Clifford Geertzin in Agricultural Involution: The Processes of Ecological Change in Indonesia published in 1963.
Geertz examines Indonesia's agricultural dynamics under Dutch colonial rule. He portrays a stark economic contrast: the Dutch controlled a thriving economy, while the native Indonesians struggled with a stagnant one.
Geertz called this “agricultural involution”, a self-defeating process where the expanding Indonesian population was engaged in labor-intensive wet-rice cultivation without advancing production technologies.
Involution in modern China has similar characteristics: ever-increasing competition for a decreasing amount of resources.
So we translate “involution” as “destructive competition”.
In the context of the price wars in China’s solar industry, PV manufacturers are desperate, selling at prices lower than the cost of production.
It’s a destructive “race to the bottom”.
Andrew Methven is the author of RealTime Mandarin, a resource to help you learn contemporary Chinese in context, and stay on top of the latest language trends in China.
Read more about how this story is being discussed in the Chinese media in this week’s RealTime Mandarin.