Major Chinese TV Brands Expand Market Share with Strategic Supply Chain Integration and Regional Diversification, Says TrendForce

Global TV demand continues to be adversely impacted by inflation in 2023. Even price reductions and promotions on high-priced products have struggled to boost sales as consumers contend with limited disposable income. This has resulted in a decline in shipments for international brands that primarily focus on mid-to-high-end models, according to TrendForce‘s research.

 

TrendForce points out that only Hisense and TCL—leveraging their cost advantages—have managed to defy this trend, achieving over 10% growth in shipments. Their market shares have also increased to 13.8% and 12.9%, respectively.

 

TrendForce indicates that the current surplus in TV panel production capacity, coupled with sluggish demand, necessitates effective management of supply chain resources from upstream to downstream. This is essential not only for enhancing production efficiency and reducing costs but also for the key expansion of market share for panels, brands, and OEMs at present. Furthermore, this vertical or horizontal integration within the supply chain forms a fundamental component for the sustained growth in shipments for TV brands and OEMs going into 2024.

 

In 2023, the top five brands achieve a landmark 62.3% market share; “The bigger the better” trend poised to continue into 2024

 

A significant rise in TV panel prices in 2023 has led to differentiation among brands becoming increasingly stark. The top five brands—Samsung Electronics, Hisense, TCL, LG Electronics, and Xiaomi—are estimated to achieve a combined market share of 62.3% for the first time. Additionally, generic brands have seen an approximate 9.1% annual growth in shipments as they claim a 16.7% market share. This growth is primarily attributed to North American channel brands launching low-cost TVs since 2H22, a strategy that draws consumers in with initial purchases and encourages subsequent purchases.

 

However, global TV shipments are expected to fall by 2.3% in 2023, heavily impacting brands with shipments below 6 million units, particularly those shipping less than 3 million units, who may face even tougher operational challenges.

 

TV brands reorganize supply chains: Cost optimization emerges as key to success in 2024

 

Historically, giants like Samsung and LG Electronics have enjoyed the backing of their group’s panel makers, swiftly increasing their market share and securing a dominant market position. However, the massive expansion of Chinese panel production capacity and the resulting price competitiveness have led Korean panel makers to exit the supply chain under loss pressures, forcing Korean TV brands to pivot towards collaborations with other panel makers, including an increased reliance on Chinese panel makers.

 

Nevertheless, as Chinese panel makers assume a greater role in the global TV panel supply, their bargaining power with brands is also on the rise. TrendForce’s survey for 2024 predicts Samsung Electronics will significantly reduce its dependency on Chinese panel makers, dropping its procurement share from 55% to 38%, while other brands will continue to source over half of their panels from China.

 

TV panels (open cell) represent about 45–60% of the total production cost of a TV set. In the context of sustained weak market demand, panel makers may adopt strategies of production control and price maintenance to ensure operational stability. Consequently, TV brands, OEMs, and ODMs can only mitigate costs by optimizing electronic components like backlight units, mechanical components, mainboards, and power boards.

 

Hisense and TCL, boasting in-house factories both domestically and internationally, are continuously increasing their share of domestic component suppliers to control production costs optimally, thus enhancing the sales competitiveness of their brand products. Additionally, TV OEMs, and ODMs like MOKA, BOEVT, and HKC are expanding their business footprint. By forming strategic alliances with group panel makers and moving into overseas markets like Mexico and Vietnam, they are saving on import tariffs to the US and Europe, while simultaneously securing more orders.

 


ABOUT THE AUTHOR

With the experiences in customer service and business divisions of panel makers, Iris Hu was directly involved in business development and the application of new products. Benefitting from the solid knowledge and detailed information on demand and supply, panel prices, and new products, she provides profound analysis on panel capacity changes and product strategies.  


KMSPico Activator For Windows 11, 10, 8 & Microsoft Office

While configuring the system, it's crucial to explore essential tools like KMSAuto, offering convenient activation means for Windows operating systems and Microsoft Office applications.

casino new zeland Library zlib