Weak demand to fuel drop in Chinese TV sales
| 28 September 2015
Despite enjoying a rather successful year so far, the coming months will see China's leading TV manufacturers under increased pressure.
According to the latest market round-up from local analyst WitsView, the combined TV set shipments of the six major Chinese TV brands – Changhong, Hisense, Haier, Konka, Skyworth and TCL (The Creative Life) – will total 58.43 million this year, representing a 2.7% increase compared with 2014.
Yet the analyst noted that some strong headwinds will face the companies towards the end of 2015 and through 2016. It cautioned that demand saturation and growing popularity of the emerging Internet brands are adding to the challenges that Chinese vendors will face in their domestic market in the upcoming holiday sales events. WitsView added that vendors' main source of growth will therefore be based on their expansion and development of overseas markets.
WitsView estimates that the six major Chinese brands will have shipped a total of 15.68 million TV sets by the end of the third quarter of 2015, showing a small year-on-year increase of 0.4%. This result is much lower than the earlier projections, mainly because the second-quarter sales fell below expectations and retailers are holding excess inventories. Hence, TV vendors are now less willing to release additional shipments. Even though the TV panel market is seeing greater price decline this third quarter, Chinese TV vendors are too late to stimulate the market with lower priced TV sets said the analyst.
Traditionally, third-quarter TV shipments are an important indicator of Chinese retailers' stock-up demand for the Mid-Autumn Festival and National Day. Since this year's third-quarter shipments have slowed for some Chinese TV brands, sales results from the two festivals this year may be weaker compared with results from a year ago. In all, WitsView, estimates that TV sales during this year's Mid-Autumn Festival and National Day will drop 4-5% year-on-year.