Date: 10/04/2011

17 top LCD TV brands grew 15% from Feb to Mar in 2011

According to the March edition of the DisplaySearch MarketWise - LCD Industry Dynamics report, monthly production by the 17 top LCD TV brands grew 15% from February to March, and is forecasting to grow 6% M/M in April.

In Q1'11, the leading 17 LCD TV brands planned to produce 41.1 million LCD TVs, and are targeting 44.8 million units for Q2'10, up 9% Q/Q. LG Electronics, as well as Chinese set makers like TCL, Hisense, Skyworth and Changhong, are the most aggressive companies, aiming for double-digit Q/Q growth. Japanese brands, including Sharp, Panasonic, Sony, and Toshiba, are planning for lower growth or reduced production due to the earthquake in Japan and the uncertain economic situation.

"Supply chain inventory is at a healthy level due to aggressive price cuts since Q4'10, and new LCD TV models are in the pipeline and on the way to retail shelves," noted Deborah Yang, Research Director at DisplaySearch and the author of the report. "Our research indicates that LCD TV brands tend to err on the cautious side, prioritizing inventory control and adjusting production plans as needed, in case sell-through in main markets is not as good as expected."

In February, production by the surveyed LCD TV brands was only 5% less than previous plans, but the March forecast shows a more conservative plan. The 9% growth planned for Q2'11 may be upset by slow sell-through in the main markets and weak demand in Japan. The production forecast varies by TV brands; some leading brands reported double-digit growth Q/Q, but others estimate a decline in Q2'10.

Figure 1: Major LCD TV Brands Production Plan (Millions)

ee Herald

Source: DisplaySearch March 2011 MarketWise - LCD Industry Dynamics

Monthly production activities are influenced by sell-through results and new model launch schedules, and will influence panel inventory and procurement plans. Samsung's LCD TV production has been steady at 3 million per month for the first six months, with the exception of 3.3 million units in March. Sony plans to maintain its production levels at 1.9 million units from March to June, while LG Electronics plans to raise production from 2.3 million units in February to 2.6 million units in June.

In general, China TV makers' production will peak in April. However, in preparation for the coming May Labor Day shopping season, Chinese brands, especially Changhong, Hisense, Skyworth and TCL, are raising their production volumes in March, April and May. LCD TV panel makers are increasing shipments to the China market.

Other key findings from the March MarketWise - LCD Industry Dynamics report include the following:
LCD TV OEM makers also planned to significantly increase their production and shipments in March. The top 7 LCD TV OEM companies shipped 3.1 million units in February and are expected to ship 4.4 million in April. For Q2'11, they are targeting an average of 4.8 million units per month.
In February, LG Display replaced Chimei Innolux as the leader in LCD TV panel shipments to China TV makers.
Panel makers are cautious about utilization rates. The global average was 83% in March and is expected to be the same in April, before rising to 85% in May.
LCD TV panel shipments in February declined 4% M/M and are estimated to increase 22% M/M in March. Shipments are expected to stay at similar levels in April and May, before seeing another increase in June.
Korean and Taiwanese panel makers have different expectations for LCD TV panel shipments over the next few months. Korean makers are aiming to increase, especially as they have implemented new Ti/Cu processes; Taiwanese makers are planning to stay flat or grow slightly in Q2'11.