An expanding global electronics market for large flat-panel televisions will contribute to a growth in sales for the nation's home-appliance manufacturers
Teco Electric & Machinery Co (東元電機), the nation's largest maker of industrial motors and a major home-appliance manufacturer, introduced three new models of liquid-crystal display (LCD) TVs yesterday, with 26-inch, 27-inch and 40-inch screens.
The company hopes to sell 100,000 units of LCD-TVs generating sales of more than NT$2 billion this year, said Wu Hung-ting (
Teco is stepping into a market where many of its home appliance manufacturing rivals said they wouldn't be left out. Recently, Sampo Corp (
The potential profitability of flat-panel TVs has also gained the notice of the world's biggest notebook computer maker, Quanta Computer Inc (廣達電腦). Quanta has announced plans to start selling flat-panel TVs in the fourth quarter of this year, a Chinese-language newspaper reported yesterday, citing the company's chairman, Barry Lam (林百里).
Competition
In anticipation of an increasingly competitive market, Teco dropped the price of its 30-inch LCD TV model by NT$10,000 to NT$69,999 in late May. The reaction was impressive, as Teco reportedly sold nearly 10,000 units of the model by mid-August, Wu said.
One analyst said Teco's strategy is on the right track, as the emerging flat-panel TV market can provide Taiwanese manufacturers access to the world market, instead of the limited domestic market.
"Teco is making use of the domestic market as a trial ground to help its future expansion to Japan and Western countries," said Eric Twu (
The local market, which accounts for nearly 80 percent of the nation's home-appliance makers' total revenue, has reported sluggish sales for years, and manufacturers have been desperate to find a new product to drive their business, he explained.
"The emerging demand for flat-panel TVs gives them a chance to be reborn," Twu added.
No more CRTs
It is estimated that there are 150 million cathode-ray tube (CRT) TVs worldwide, and as prices drop, consumers will gradually switch to flat-panel screens such as LCD-TVs or PDP-TVs, according to Twu.
The price of a 42-inch screen plasma TV dropped nearly 65 percent over the past three years, and now retails for around US$4,550 in North America, he said.
The global market is expected to consume 4 million flat-panel TVs this year, and the figure is projected to hit 10 million units in 2005, Twu said.
Easy access to key components is a major strength for Taiwanese manufacturers.
"Since Taiwan is the world's second-largest production center of flat-panel displays, [flat-panel] TV makers can gain access to components easily," said Chen Yen-liang (
In addition, eying the profitable flat-screen TV market, most of the nation's screen makers such as Chi Mei Optoelectronics Corp (
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