Chi Mei Optoelectronics Corp (CMO, 奇美電子), Taiwan’s second-largest liquid-crystal-display (LCD) panel manufacturer, said yesterday that last month sales dropped 10 percent from a year earlier, another sign of the arrival of a new overcapacity-driven downturn.
The Tainan-based company made sales of NT$23.2 billion (US$75 million) last month, compared with NT$25.8 billion a year ago as rising inflation and the weakening global economy hurt demand and hit prices. That represents approximately a 17 percent month-on-month decline from NT$28 billion in June, the company statement said.
Shipments of computer and television panels fell by 17.7 percent month-on-month to 4.83 million units last month from 5.87 million units in June, the company said. Overall, CMO expects shipments at best to be flat, or to drop up to 5 percent this quarter from last quarter.
The reduction in sales and shipments last month was greater than larger rival AU Optronics Corp (友達光電), which said last month’s sales fell by 11 percent, while shipments dropped 4.7 percent month on month.
CMO said it lowered equipment loading by 10 percent in the middle of last month to cope with the unexpected weakness in demand, which has been caused by customers having excessive inventories.
In the third quarter, CMO plans to cut production by 15 percent from the second quarter, following in the footsteps of industry leaders AU Optronics and South Korea’s LG Display Co.
Smaller LCD panel maker HannStar Display Corp (瀚宇彩晶) said yesterday that last month’s sales plunged 41 percent to NT$4.95 billion from the same period last year, following the sale of a second plant to Wintek Corp (勝華) last December.
On a monthly basis, the company’s sales were down 23.5 percent. Shipments of computer and television panels also dropped 15.6 percent month-on-month to 1.24 million units.