Shipments of smaller HD LCD panels dropped and larger 4K UHD panels have increased, accounting for 20 million of the 60.16 million panels shipped in Q1, 2017.
Witsview, a division of Trendforce, reported that TV panel demand was shifting from smaller to larger panels. Iris Hu, research manager of WitsView, said, “Prices in the 40" to 43” segment are too high for TV brands to create promotional offerings for China’s major sales events during the second quarter. Panels in the 55" to 65” segment, on the other hand, provide higher margins.”
Major international TV brands are aggressively positioning themselves in the 75” segment.
{loadposition ray}All figures quoted are Q1, 2017 compared to Q4, 2016
LG Display (LGD) LCD TV panel shipments fell as the supplier adjusted the product mix for one of its Gen-8.5 fabs and allocated more of its production capacity to making OLED products. The supplier also cut back on the production of monitor panels sized 21.5” wide and smaller and instead of expanding production of monitor panels sized 23.8” wide and 27” wide.
This is also in response to monitor brands’ need for larger panels to raise their product margins. In doing so, LGD also took away some of its Gen-8.5 capacity originally intended for TV panels. Despite recording a noticeable decline, LGD was still first in TV panel shipment ranking in this period.
Demand for Innolux’s 39.5” products fell as TV brands reached their price limits for the mid-size segment. While Innolux saw an increase in orders from Samsung Electronics for its 65” panels, the supplier was not able to significantly increase shipments for this size category due to low product yield rate.
Since September of 2016, BOE has been adjusting its product mix to increase the share of notebook panels at the expense of the 32” TV panels. This has led to continuing decline in panel shipments. On the other hand, BOE raised shipments of its 43” panels by 26.6%. With its Gen-8.5 fab in Fouzhou, China, at the final preparation stage for mass production, BOE aggressively priced its 43” panels to entice TV brands.
There was no increase in China Star Optoelectronics Technology (CSOT) production capacity during the first quarter, and the supplier’s shipments were further affected by seasonality. However, CSOT did enjoy a 15% sequential growth for its UHD products owing to strong demand from TV brands. To increase the margins of their TV set line-ups, brands are increasingly using the UHD feature.
Samsung Display (SDC) went from second place to fifth place. This plunge was mainly attributed to the closure of the L7-1 fab at the end of 2016. Though SDC had a very poor overall performance, the company was ahead of its competitors in the shipments of 75” TV panels, growing the volume by 30% to reach 130,000 units.
SDC’s recent overhaul of its manufacturing equipment has led to a large shipment expansion for large-size UHD panels. It became the first panel maker to surpass 50% in UHD penetration for TV panel shipments during the first quarter. UHD-resolution products accounted for 52.8% of SDC’s TV panel shipments.
While AUO has limited production capacity, the company manages to stay competitive by increasing shipments of large-size and niche products. Thus, AUO posted a 3.8% sequential increase in shipments of 65” and larger panels. Furthermore, the UHD penetration in the supplier’s first-quarter TV panel shipments came to 40.7%, up from 36% in last year’s fourth quarter.