Global LCD Panels to See Output Cut as Makers Show Differentiation Strategies

by hitouchz80 on 2012-03-07 11:48:09

"Originally, panel manufacturers planned to increase capacity utilization to 85-90% in the third quarter, but now it has only reached 75%." Display Search analyst Shawn Lee said that the market performance in this year's third quarter is obviously different from the past. According to his introduction, there has always been a gap between the planned production volume of TV panels and the planned shipment volume of TV panels for panel companies in the past. This is because panel manufacturers want to keep some space to deal with sudden demand. However, this year's situation is that the planned production area is very close to the planned shipment volume, which shows that the panel manufacturers' judgment on the TV market is quite conservative. Panel manufacturers are competing to grab shares through differentiation. For example, Samsung recently announced a strategy of "one inch larger". It was learned from Samsung Electronics that Samsung Electronics especially launched 43-inch and 48-inch LCD panels in the Chinese market, both of which are one inch larger than other brands' products. From the statistics of Display Search report data, compared with the previous quarter, all global 5-8 generation lines showed double-digit declines, ranging from 12-28%, while only the 10th generation line increased, mainly due to the low start-up rate in Japan affected by the earthquake in the second quarter. For example, the monthly production area of the global 5th generation line panel factory in the third quarter is about 2.1 million square meters, down 21% quarter-on-quarter and 6% year-on-year. The corresponding production data of the 5.5 generation line panel factory is 300,000 square meters/month, down 28% quarter-on-quarter and up 16% year-on-year. The production area of the 8th generation line is about 3.5 million square meters/month, down 19% quarter-on-quarter and up 17% year-on-year. (Editor: Ying Xu) A related person in charge of Samsung Electronics said that the 43-inch and 48-inch LCD panels launched for the Chinese market have the same appearance size as the existing 42-inch and 47-inch panel products of competing companies, but the panel frame thickness has been compressed to 9 mm, allowing RGB to release new switches that can support multi-format input, so the hidden part of the picture can be effectively utilized. With the outbreak of unstable European finances, Japanese earthquake disasters, and the downgrade of U.S. credit ratings, uncertainties in the future flat-panel TV market have expanded. In response to challenges, panel manufacturers are grabbing shares through product differentiation. The unfavorable market environment is also a severe test for domestic panel enterprises that are just starting out. Wang Jiaheng, Chief Operating Officer of BOE, said at the recently held 2011 International Flat Panel Display Industry Summit Forum that although it is difficult to predict the demand for the flat panel display industry, the expected annual growth rate could reach 7-9%. Regarding this market, BOE will accurately grasp customer needs and continue to introduce various products. "A 240 Hz 3D TV module will come out soon in the fourth quarter, and FPR 3D TVs will also come out at the end of this year or early next year," Wang Jiaheng said, adding that interactive displays, transparent displays, and glasses-free 3D TVs would develop from 2015 onwards. TV panel production in the third quarter decreased by 13%. In terms of specific use, the quarterly production area of TV panels is about 7.5 million square meters/month, showing a 13% quarter-on-quarter decrease. The market recovery hoped for by panel manufacturers did not appear in the third quarter. According to the latest survey report from market research firm Display Search, due to continuous falling panel prices and weak demand expectations, panel manufacturers continue to adjust their production strategies for the second half of 2011 and control panel output. The report estimates that the total production area of global panel production lines in the third quarter of 2011 will be 12.2 million square meters/month, still increasing by 5% year-on-year, but decreasing by 14% compared to the second quarter's 14.2 million square meters/month. Due to the still unclear market prospects, the production level in the fourth quarter of this year may only maintain around 12 million square meters/month. It is introduced that Konka, Changhong, Hisense, Haier, and other Chinese enterprises have already adopted Samsung's 43-inch and 48-inch panels and plan to launch them in the market during the National Day holiday in early November.