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LCD TV panel shipments fall in Q3 for the first time

Posted: 09 Oct 2013     Print Version  Bookmark and Share

Keywords:LCD TV panel shipment  Samsung  AUO  CSOT  Sharp 

According to the most recent report from IHS, the global market for LCD TV panels dipped in 3Q13 compared to the second. As a first for the industry, this signifies a worrisome development during what is normally a strong period of the year, noted the market research firm.

Global LCD TV panel shipments in a preliminary estimate during Q3 reached 58 million units, down from 58.8 million in Q2. Last year, Q3 shipments totalled 60 million, up markedly from 54.5 million during the previous quarter.

"LCD TV panel shipments went through a soft period in Q3," said Ricky Park, senior manager for large-area displays at IHS. "The downshifting of the market comes as a surprise because the third quarter is usually a time when things start heating up, in preparation for the furious upcoming Q4 selling season. However, consumers have not been buying as many new television sets as originally hoped, leaving TV brands with panels that they haven't been able to move."

The stockpiles held by brands have been aggravated in particular by the large panel shipments made to them by LCD TV panel makers during H1.

The weak Q3 numbers will be especially hard on panel makers that serve Chinese TV brands. TV sales in China have been on the decline since the end of Q2, and sales are not expected to improve much despite the upcoming China National Day in October. Among the panel makers affected by this turn of events are Innolux and AUO of Taiwan, both of which suffered a fourth month of declining shipments during July.

Some other panel makers, however, are having a better time. One Chinese-based maker, CSOT, is maintaining healthy inventory even though it has the highest portion of Chinese customers for TV panel shipments, thanks to an expansion in its client base that includes, the largest TV brand in sales, Samsung from South Korea.

Overall, panel suppliers whose main customers are outside of China will also enjoy relatively better prospects than panel makers whose main clientele are the Chinese. For instance, makers such as Samsung Display and Japan's Sharp, with the lowest percentage of Chinese TV brands as customers, will see their share of the LCD TV panel market enlarge in Q3.

Panel makers kept overall fab utilisation rates at 83 to 84 per cent in Q3, not too far off from the 80 to 83 per cent level seen in Q2. Utilisation rates, however, are not likely to increase moving forward because of uncertainty in Q4, coupled with continuing weak demand from the market.

Among panel makers, Beijing-based BOE was the one to have increased shipments in July. Top-tier brands like Samsung and LG were among the panel buyers that increased their purchasing volume from BOE during the month.

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