Taiwanese liquid-crystal-display (LCD) panel makers lost market share to bigger South Korean rivals last month as the weakening won helped the Koreans undercut prices in the latest industrial slump, market researcher DisplaySearch said in its latest report.
Last month, Taiwanese LCD panel suppliers, including top player AU Optronics Corp (友達光電), held 34.3 percent of the overall computer and television flat-panel shipments market share, down 5.3 percentage points from 39.6 percent in October, statistics compiled by the Austin, Texas-based researcher showed.
Further widening their lead over Taiwanese companies, South Korean competitors including LG Display Co Ltd increased their shares by 3.1 percentage points to 50.9 percent last month, compared to 47.8 percent in October, the report showed.
“A combination of slow demand, the tendency of leading brands to favor internal sources of supply and depreciation of the Korean won has disadvantaged Taiwanese panel suppliers, leading to a loss of market share,” DisplaySearch said in the report released on Friday.
DisplaySearch did not provide detailed currency information. The New Taiwan dollar depreciated 0.18 percent versus the US dollar to NT$32.53 on Friday, while the won was down 0.21 percent against the US dollar.
“The TFT LCD industry is going through the hardest time in a decade, as shipments and revenues dramatically decline,” David Hsieh (謝勤益), a vice president of DisplaySearch, said in the report.
Global LCD panel PC and TV shipments fell 25 percent year-on-year to 28.5 million units last month, marking its lowest level in six months, with PC monitor shipments battered by economic slowdowns, the DisplaySearch report showed.
Decline in revenues is more drastic as panel prices are in a nonstop downward spiral. Overall revenues plunged 50 percent year-on-year to US$3.8 billion, the weakest since July of 2006, the researcher said.
Prices for mainstream 19-inch LCD PC wide-format panels are expected to drop another 6.4 percent, or US$4, to average US$59 per unit in the second half of this month from two weeks ago, another survey by DisplaySearch indicated, blaming oversupply and shrinking demand amid economic recession.
Prices for mainstay 32-inch LCD TV panels may slide by 11 percent, or US$20, to average US$165 during the same period, the latest survey showed.
“The industry will need to take additional steps to reduce capacity utilization, since falling panel prices are not stimulating demand under the current economic conditions,” Hsieh said.
To cope with the weak demand, Taiwanese panel makers have lowered capacity utilization to below 60 percent, while South Korean manufacturers have cut utilization rate to less than 80 percent, DisplaySearch said.
“Continuing to reduce panel prices will cause continued pain for the whole supply chain, including panel makers, materials makers and set makers,” Hsieh said.