TV panel prices tumbled last month due to a saturated market and full inventories, TrendForce Corp’s (集邦科技) research division WitsView said yesterday.
Rising concerns that US tariffs of 25 percent would take effect in the third quarter and a plan by S-LCD Corp, a leading manufacturer of amorphous TFT-LCD panels for flat screen TVs, to close its 8.5-generation plant in the second quarter have led TV brands to restock their inventories in advance, causing a fall in TV panel prices, WitsView research manager Iris Hu (胡家榕) said in a report.
Although S-LCD, a subsidiary of Samsung Electronics Co, has decided to delay the closing of its plant until this quarter, distributors have already filled their inventories to capacity, resulting in an imbalance between supply and demand, Hu said.
Panel prices would continue to fall despite a handful of firms making inventory adjustments mainly due to Chinese TV brands’ lackluster performance in the first half of the year.
The price of 32-inch TV panels fell by more than 10 percent last month to US$36 owing to sluggish demand, she said.
While Boe Technology Group Co (京東方) attempted to compensate by cutting its production, Innolux Corp (群創) increased its production of 32-inch TV panels as it lost orders of 58-inch panels to China Electronics Corp (中國電子).
Supply of 65-inch and 75-inch panels rose far above demand as China Electronic’s 10.5-generation plant in Hefei, China, reached full production capacity and China Star Optoelectronics Technology’s (華星光電) 11-generation production line maintained its output, Hu said.
The average price of a 65-inch TV panel fell US$10 to US$185 last month, while the average price of a 75-inch TV panel feel by between 7 and 9 percent to less than US$400, she added.
Due to the falling prices of 65-inch TV panels, fewer consumers are purchasing 55-inch TVs, while production of the panels has increased by 3 to 4 percent year-on-year.
That resulted in the average price of a 55-inch TV panel declining by US$10 to US$116 while demand has yet to return and companies face the risk of further price declines.
The prices of 32-inch and 55-inch TV panels could plummet past their production cost next month, and prices of 65-inch and 75-inch panels would also continue to decline, Hu told the Taipei Times by telephone yesterday.
Companies would have to look to lowering raw material costs, wages, and electricity and water fees in an effort to minimize their losses, she said, adding that adjusting their product mixes could also help.
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