Tue, Nov 13, 2007 - Page 12 News List

Demand may out run panel supplies next year, MIC says


Market Intelligence Center (MIC, 資訊市場情報中心) said yesterday that global demand for computer and TV flat panels could greatly exceed supply in the second half of next year as panel makers slowed capacity expansion over fears of a glut.

Taipei-based MIC joined Austin, Texas-based DisplaySearch and local major flat-panel makers in forecasting a bullish outlook for the liquid-crystal-display (LCD) industry next year.

But the robust outlook did not help local LCD panel stocks yesterday. Shares of the nation's two biggest flat panel makers, AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp (奇美電子), plunged by 6.93 percent and 6.92 percent to NT$63.1 and NT$46.4 respectively, dragged down by the weak broad market.

Flat screen demand -- mostly screens used in mainstay 15-inch notebook computers -- is expected to outpace supply by 11 percent to 16 percent in the second half of next year extending this year's severe shortage, MIC analyst Charles Chou (周士雄) said.

"Global LCD panel makers put off their new next-generation plant construction plans because of massive investment and a high technological barrier. This will slow the overall capacity growth rate," Chou said.

Output of the world's LCD panel makers, including LG Philips LCD Co and AU Optronics, is expected to increase nearly 18 percent year-on-year next year, compared to the annual growth of 36.9 percent this year and 63.8 percent last year, MIC said.

Demand for larger computer and TV screens was on the rise, however, although the growth of PC unit shipments were slowing, Chou said.

Panel makers have also allocated more capacity to make small and-medium sized LCD panels in order to meet strong demand for screens used in digital frames and consumer electronics such as DVD players, he said.

The demand for small and medium-sized LCD panels for mobile phones and portable DVD players is expected to rise 20 percent to 60 million units next year from 50 million this year, MIC analyst Hsieh Pei-fen (謝佩芬) said.

"Supply may not be able to match demand next year, if mobile phone growth in China and digital frames is sustained. Every company is trying to locate sufficient panel supplies as quickly as they can," Hsieh said.

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