Large-sized panel shipments fall by 4.9% QoQ to 105.3 million units in 3Q08

Global aggregated large-sized panel shipments in 3Q08 reached 105.3 million units, a QoQ decrease of 4.9% and a mere 3.4% YoY growth. Thanks to preparations for China’s National Day holidays and year-end sales promotions, TV panel shipments were up monthly during the third quarter. For 3Q08, they reached a new record high of 26.7 million units, up 12.7% QoQ. In the IT segment, in the wake of the sharp panel price falls in 3Q08, and the strong inventory pull-in during 1H08, it resulted in overly high inventory levels for both brand vendors and SIs during the beginning of 3Q08. In general, as the end market demand was severely impacted by the global financial turmoil, both consumers and enterprises tightened their belts. Due to the sluggish demand, NB panels instead fell by 3.7% QoQ to 34.1 million units. Monitors fell even more notably, down by 13.8% QoQ to 44.5 million units. On a yearly basis, this amounted to a decrease of 9.2%. 

Figure: TFT-LCD Panel Shipment (K units)

Application

Q208

Q308

QoQ

YoY

TV

23,712

26,728

12.7%

18.1%

Notebook

35,447

34,118

-3.7%

12.6%

Monitor

51,574

44,469

-13.8%

-9.2%

TTL

110,733

105,315

-4.9%

3.4%

Area-wise, the global large-sized TFT LCD panel shipments reached 17.6 million square meters, up 3% QoQ. The increase was mainly attributed to the notable TV panel shipment growth during 3Q08.

It is interesting to note that some market share changes were seen during 3Q08. The TV and monitor market share of the Korean players increased 2.3 percentage points to 45.8%, thanks to their respective own-brand support and depreciation end of below G6 lines. For the Taiwan suppliers, their share was instead down by 2 percentage points to 46.1%. This was due to their more aggressive production cutbacks, and the sharp monitor panel shipment drop, which accounted for the largest share in their product mix. Turning our attention to the Japanese players, the quarterly growth in TV shipments helped push its market share to 4.3%, up 0.7 percentage points. Finally, the China-based suppliers’ share was down slightly to 3.9%. Based on the performance of the respective panel makers, Samsung topped the list for all three applications, where it shipped a total of 24.63 million panels in 3Q08.

Figure: % of Regional TFT-LCD Panel Shipment (unit base)

Application

Korea

Taiwan

Japan

China

TV

42.0%

43.0%

15.1%

0.0%

Notebook

61.9%

36.7%

1.4%

0.0%

Monitor

35.6%

55.1%

0.0%

9.3%

Total

45.8%

46.1%

4.3%

3.9%

In light of the macroeconomic woes, and unfortunate natural disasters in China, demand was severely impacted. The accumulated panel and set inventory prompted downstream vendors to discreetly adjust their inventory. Meanwhile, panel makers sharply lowered their prices in securing more panel orders. TV panels also saw sharp price drops, as panel makers tried to gain more orders aimed at China’s National Day holidays and year-end sales promotions. For 3Q08, the average price of each panel was down $30 or 17% QoQ to $148. For each square meter, prices reached $883, down 23.4% QoQ.

In the wake of the production cutbacks by the Taiwanese panel makers and inventory adjustments during 3Q08, the current panel inventory has returned to a healthier level. Yet, the persisting macroeconomic troubles continue to weigh on the end market demand. The uncertain demand and likelihood of panel prices falling further is rendering both the brand vendors and SIs to hold a cautious outlook toward 4Q08 and 1H09. Meanwhile, based on the current market conditions, the production cutbacks by the panel makers will likely continue for another 1 to 2 quarters. Beginning from November, the traditional weak seasonality effect should become more evident. For 4Q08, shipments are expected to drop by 6~7% QoQ.

 

 


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