Chinese Glut Hurts Panel Maker Prospects

IHS has said that LCD panel makers are at risk of incurring ‘deep losses’ this year, as Chinese makers ‘aggravate already severe oversupply’. The comments were made at a display conference in Asia.

The global supply of LCD panels will rise 6% YoY in 2016, doubling the 3% growth in demand. This will mostly be down to supply from China’s BOE and CSOT, IHS predicted. China’s global LCD panel market share is expected to rise from 19.5% in 2015 to 23.7% in 2016. Most of this gain will be ‘stolen’ from Taiwan, which will see its share fall from 34.6% to 32.9%.

“We only see a brief rebound in panel prices in the second quarter and third quarter, primarily due to stock-building demand from major TV brands including Samsung Electronics Co and Chinese TV vendors,” said IHS’ David Hsieh. Such demand would be short-term, and not enough to end the supply glut. He added, “Most panel companies will remain in the red throughout the whole year.”