Slowing LCD TV Demand Alters Panel Manufacturers’ Business Strategies, According to NPD DisplaySearch

Sort Date: 03132013

SANTA CLARA, CALIF, March 13, 2013—LCD TV panel manufacturers are planning less aggressive business strategies for 2013 as LCD TV demand growth slows, according to the latest NPD DisplaySearch Quarterly LCD TV Value Chain Report. Panel makers are moving to avoid an oversupply of LCD TV panels. This involves a drastic change in business models, which includes developing strategic alliances, making capacity allocation improvements, and expanding product portfolios to include a larger variety of panel sizes. LCD TV panel manufacturers hope that by moving to larger screen sizes, they can decrease unit shipments while increasing total area shipped, thus boosting their bottom lines.

“Consumers are focused on TV prices, while brands have been focused on TV features. This disconnect has resulted in reduced demand and profits for TV supply chain participants in 2012,” said Deborah Yang, NPD DisplaySearch Research Director. “A misalignment in panel size portfolios between buyers and sellers could result in supply constraints. Panel makers and TV brands are trying to strengthen their business portfolios and enhance their bargaining power with supply chain participants in order to improve profitability and gain a competitive edge.”

Taking these factors into account, along with the aggressive TV shipment plans of some TV brands (in particular the top two Korean TV brands and Chinese TV makers), NPD DisplaySearch forecasts 4% Y/Y growth in LCD TV panel shipments for 2013 and 11% Y/Y growth in TV shipments planned by surveyed TV brands. Samsung and LG, for example, are working with Sharp to increase panel supply in 2013, mostly for 32” panels.

Table 1: LCD TV Panel Shipments and Targets by Supplier (M units)

Supplier

2011

2012

2013

 

2011 Y/Y

2012 Y/Y

2013 Y/Y

(Actual)

(BP Jan'13)

(BP Jan '13)

 

(Actual)

(Jan'13 Update)

(Jan'13 Update)

AUO

33.0

32.5

36.0

 

-4%

-2%

11%

BOE

2.5

11.6

16.0

 

279%

369%

38%

CEC-Panda

0.2

3.0

3.2

 

NA

1415%

7%

Chimei Innolux

43.7

45.7

43.0

 

-2%

5%

-6%

China Star

0.2

11.0

18.0

 

NA

5089%

64%

InfoVision

0.7

0.0

0.0

 

-72%

0

0

LG Display

53.0

56.8

53.0

 

3%

7%

-7%

Panasonic LCD

10.4

5.6

4.0

 

18%

-46%

-29%

Samsung

50.0

54.6

55.0

 

0%

9%

1%

Sharp

14.6

8.8

11.3

 

-32%

-40%

28%

Total

210.2

229.6

239.6

 

-5%

9%

4%

Table 2: LCD TV Shipments and Targets by Brand (M Units)

Brand

2011
Shipments

2012 (F)
Shipments

2013 (F)
Shipments

2011
(Y/Y)

2012
(Y/Y)

2013
(Y/Y)

Samsung

38.5

40.0

45.0

12%

4%

13%

LGE

24.7

26.9

30.5

6%

9%

13%

Sony

20.4

14.5

14.5

-6%

-29%

0%

Toshiba

14.8

12.0

12.0

6%

-19%

0%

Sharp

13.5

8.0

8.0

-4%

-41%

0%

Panasonic

13.4

10.5

10.5

40%

-22%

0%

TCL

10.0

11.7

13.5

43%

18%

13%

Hisense

9.2

9.0

10.7

25%

-2%

19%

Philips/AOC

9.1

8.5

10.0

3%

6%

18%

Skyworth

7.2

8.1

8.8

12%

13%

9%

Funai

5.7

6.8

7.5

3%

19%

1000%

Changhang

5.2

6.0

7.2

30%

16%

18%

Vizio

5.3

6.0

7.0

-24%

12%

17%

Konka

4.8

5.8

6.9

16%

22%

18%

Haier

4.0

6.0

8.0

-2%

50%

33%

Top 15 Subtotal

185.8

179.8

200.0

6%

-3%

11%

Worldwide Total

205.0

204.5

216.1

7%

0%

6%

Key Channel/
Private Brand

2011
Shipments

2012 (F)
Shipments

2013 (F)
Shipments

2011
(Y/Y)

2012
(Y/Y)

2013
(Y/Y)

BestBuy

3.3

4.0

4.0

-14%

21%

0%

Becko

2.0

2.5

3.5

33%

25%

40%

Coby

0.6

1.4

2.0

175%

155%

43%

Tongfang

0.5

2.3

3.0

150%

360%

30%

UMC

2.0

2.4

2.4

-13%

20%

0%

Vestel

7.8

7.8

8.2

12%

0%

5%

Source: NPD DisplaySearch Quarterly LCD TV Value Chain Report

“Some TV brands’ 2013 shipment plans reflect their strategy to set higher targets and secure sufficient panel supply, but they may also be too aggressive,” said Yang. “The TV supply chain is evolving, with Taiwanese panel makers leading the development of new panel sizes and ties with TV brands. Meanwhile, panel and set makers are adopting new business models around open cell and backlight-module-systems (BMS) assembly. Other TV manufacturers may be forced to follow suit—changing the TV value chain over the long term.”

The DisplaySearch Quarterly LCD TV Value Chain Report maps the relationships between LCD TV brands, OEMs, and panel suppliers with actual shipment information. Suppliers can determine market shares and benchmark against their competitors. Buyers can identify and evaluate key panel makers or OEMs to improve their purchasing decisions. The report covers the latest trends and cell business forecasts for 2013. All business plan targets for LCD TV panel makers, OEMs, and LCD TV brands for 2013, including sourcing information and allocations, are updated quarterly in this report. Recent upgrades to the report provide LCD TV value chain forecasts and a 12-month outlook. Analysis and implications for TV OEM business outlooks are provided, as well as special topics on the LCD TV supply chain.

About NPD DisplaySearch
NPD DisplaySearch, part of The NPD Group, provides global market research and consulting specializing in the display supply chain, including trend information, forecasts and analyses developed by a global team of experienced analysts with extensive industry knowledge. NPD DisplaySearch supply chain expertise complements sell-through information from The NPD Group, thereby providing a true end-to-end view of the display supply chain from materials and components to shipments of electronic devices with displays to sales of major consumer and commercial channels. For more information, visit us at www.displaysearch.com/. Read our blog at www.displaysearchblog.com/ and follow us on Twitter at @DisplaySearch.

About The NPD Group, Inc.
The NPD Group provides global information and advisory services to drive better business decisions. By combining unique data assets with unmatched industry expertise, we help our clients track their markets, understand consumers, and drive profitable growth. Sectors covered include automotive, beauty, entertainment, fashion, food/foodservice, home, office supplies, sports, technology, toys, video games, and wireless. For more information, visit npd.com and npdgroupblog.com. Follow us on Twitter: @npdtech and @npdgroup.

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