LCD market set to grow, with big geographical differences
| 02 December 2014
The LCD industry is changing rapidly, with a number of tendrils, according to research firm HIS which says real-world GDP growth is projected to increase 2.7% this year, 3.2% in 2015 and 3.5% in 2016.
But, upward revisions in growth forecasts for India and the Eurozone are offset by downward revisions in projections for the Russia, China, Brazil and the US.
Panel prices have increased 22% to 25%, which has been a heavy cost burden for TV brands and retailers, said the firm in an analysis. Thus, profitability has been badly eroded for TV makers. The extremely low prices necessary for the coming hot sales season will not make things better for them. Losses from currency exchange rates have further deteriorated TV makers' finances. If TV makers cannot afford to take these losses they could reset demand and reverse the current tightness.
Shipments to Chinese TV makers for the first ten months of 2014 are at a record high, the firm said, and grew 21% year-over-year. They are forecast to peak in December. Chinese TV makers are aggressively securing panel allocations in preparation for the next seasonal promotional events.
There have also been increasing concerns that the gap between 4K panel and 4K TV shipments is widening. When the panel supply has reversed to surplus, the correction for 4K panels will be the most severe.
In October, shipments of 4K TV panels declined for the first time, dropping 14% month-on-month. 4K shipments represented 9% of total TV panel shipments, down from 11% in September. LG Display will replace Innolux as the No 1 shipper, IHS said.
In North America, LCD TV sales softened in October and plasma TV sales significantly declined. In Europe, a surprising move has again come from Samsung, bringing most of its entry products down £20 since last month. Samsung has five out of the 20 cheapest models. Meanwhile, LG introduced a 25% price cut on its starter 4K TV model this month. This has provoked other brands to cut prices 15-20% on their models, according to the analysis.