China Video Industry Association deputy director Bai Weimin (白為民) is to lead an industry delegation to Taiwan later this week, but the commitment she is to make to buy panels from Taiwan this year remains unclear, as China beefs up its domestic capacity.
Bai has been invited to visit by the Taiwan External Trade Development Council (TAITRA, 貿協) every year since 2009, along with representatives from eight major Chinese TV vendors.
She is expected to announce the value of flat panels that China intends to buy from Taiwan this year at a cross-strait cooperation conference on the display industry on Thursday, and observers say the size of the commitment might be hurt by Chinese panelmakers’ expansion plans.
Photo: Reuters
For example, BOE Technology Group Co (京東方) and China Star Optoelectronics Technology Corp (華星光電), a unit of top Chinese TV manufacturer TCL Corp, saw their first 8.5-generation (8.5G) production lines become fully operational in the fourth quarter of 2012 and have since continued to expand their capacity.
Also, South Korea’s Samsung Display and LG Display have begun mass production at 8.5G factories in the Chinese cities of Suzhou and Guangzhou respectively.
That could lead to a supply-and-demand dynamic that differs from what the industry experienced last year, when South Korean and Chinese TV vendors placed significant orders for flat panels to carve out market share, creating supply shortages, market observers said.
Last year, Bai pledged to spend at least US$4.5 billion on Taiwanese panels, with ultra-HD 4K2K flat panels accounting for at least 20 percent of the total.
WitsView, a division of Taipei-based research firm TrendForce Corp (集邦科技), said TV sales during the Chinese Workers’ Day holidays starting on May 1 posted a yearly decline of 6 percent.
The lower-than-expected result came as TV vendors switched from strategies based on volume to those based on quality and value amid exchange-rate fluctuations and shrinking margins, WitsView said.
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