Question-and-Answer Session
Operator
(Operator Instructions) Your first question is from Rob Stone - Cowen & Company
Rob Stone - Cowen & Company
I wonder if you could just provide a little more color on your last comment Steve about securing 70% of your expected volume for 2009, has your target production volume changed? What is that and could you let us know what the pricing arrangements are for those orders or whether it’s just as volume commitment? Thank you.
Arturo Herrero
Okay. This is Arturo Herrero, Vice President for Sales and Marketing. So, in fact we still have the 70% as we announced previously of the sales order for 2009 and we feel comfortable that in the portfolio of customers that we have still, they are confirming the demand for next year 2009.
The rest of the 30% of the year 2009 we still are in negotiation, and after the winter season that this always very difficult in this solar market, after this season we will announce the rest of the negotiations, how they finish with new contracts.
Regarding the second question that you mentioned about the ASP, we are expecting for this New Year 2009 an increase of around 8% to 10% of the current ASP in Q4. I hope this answers your question.
Rob Stone - Cowen & Company
Right; and what would you estimate the ASP in Q4?
Arturo Herrero
So, for Q4 we are estimating ASP reduction in the level of $340 to $350.
Rob Stone - Cowen & Company
Okay and how much is ASP for 2009 influenced by the introduction of UMG modules or I assume those are selling at a lower price per watt?
Arturo Herrero
Yes, that’s correct; we will sell UMG modules with a lower ASP per watt. In fact the volumes for UMG will not be so much compared to the rest of Trina Solar modules. So, the impact of these UMG modules will be around 4% to 5% of the ASP.
Rob Stone - Cowen & Company
So that 4% to 5% of the ASP reduction is from adding UMG to the mix?
Arturo Herrero
Right, that’s correct
Rob Stone - Cowen & Company
About how much of the overall volume do you expect will be UMG?
Arturo Herrero
The volume for UMG let me pass it to our COO to answer this question.
Sean Hsiyuan Tzou
Let me clarify a little bit what Arturo just said. I think what Arturo meant is our Q4 ASP is about 3.4 to 3.5, and we are expecting a ASP drop of about 10% on this space in 2009 and the UMG impact will not be significant, because the volume is less than 10% and you will be gradually ramped throughout the end of the year and therefore 10% of the ASP drop should already consider this.
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