Expanded production capacity, historical-low LCD TV panel prices and panel makers’ efforts to clear up inventories have driven TFT LCD panel shipments to hit unprecedented highs in terms of unit and area shipments for July 2018 according to research from IHS Markit.
The study revealed that total LCD panel shipments increased by 10% in July compared with a year ago to total 64.3 million units, while area shipments jumped 19% during the same period to 17 million square metres. Unit shipments of LCD TV panels was a major contributor to the overall gains, increasing by 15% in July year on year to 24.6 million units and area shipments jumped 21% to 13.3 million square metres.
Chinese panel maker BOE led the large TFT LCD market in July 2018 in terms of unit shipments with a stake of 24%, followed by LG Display with 19%. However, in terms of area shipments, South Korea’s LG Display continued to lead with a 20% share, followed by BOE with 18%.
Attributing reasons for the growth, the analyst said that the industry had been spurred by new facilities from China, such as BOE’s Gen 10.5, CHOT’s Gen 8.6 and CEC-Panda’s Gen 8.6, which started mass production in the first half of this year. It suggested that production at the fabs has increased since the second quarter of 2018 as their glass inputs and production yield rates have improved.
“Despite the growing production, panel makers have maintained the utilisation rate and instead tried to push out panel shipments by lowering panel prices in the first half of 2018,” noted Robin Wu, principal analyst at IHS Markit. “That’s one of the reasons that panel shipments are continuously growing.”
The Large Area Display Market Tracker also showed that in the first half of 2018 panel makers suffered from high TV panel inventories due to growing production capacities. Panel prices have been weak for a year and panel makers’ profit margins have plunged, added Wu.
“Therefore, panel makers wanted to clear up the inventory before the third quarter, high-demand season, when they aim to raise the panel price back again. That has led to the fast growth in TV panel shipments lately, which as a result pulled the total large panel shipments to a historical high in July.” This has meant, as hoped by the panel makers, LCD TV panel prices rebounding in July 2018.
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