IHS has released its PriceWise data for October, which tracks panel prices.
LCD TVs
LCD TV shipment targets for the year have been set to a lower point by most major brands. TV makers need panels for the upcoming end-of-year sales – however, many still have excess inventories, and are under financial pressure. There is also pressure to drive more shipments in Q4, to avoid inventories being carried over to 2016.
As a result of the above, TV makers are continuing to request price concessions from panel makers and are becoming very cautious about panel purchases for Q4. One leading Korean brand, says IHS, plans to cut panel demand by 30% compared to Q3. China’s top six TV makers expect a 2% QoQ and 17% YoY fall in purchasing.
Panel makers have not significantly cut fab utilisation, so they are pressured to produce more panels at lower-than-market prices. With an excess supply, competition between sizes is becoming tougher. Some TV makers have been suggesting that the price gap within size categories should be narrowed, or even eliminated. There have been very aggressive prices set for 55″, 58″ and 65″ panels (including UltraHD units) – specifically from China but also some from Taiwan and Korea – which is putting pressure on smaller sizes.
Prices have fallen by as much as $9, for 43″, 48″ and 50″ open-cell products.
LCD Monitors
In monitors, some brands are approaching the end of their financial year, and so may need to make inventory adjustments in October. Too many supply sources means consistent pressure on panel prices. Due to a lack of profitability, shipments of monitor panels are expected to fall – and production capacity is being squeezed by TV panels, which are being promoted more aggressively.
Monitor price panel reductions were large in Q3, and some makers are expected to sharply lower prices on larger sizes including 23.8″ and 27″, to reach high volumes in Q4.
23.8″ 1920 x 1080 units were down $1.5 in October, says IHS, while 27″ units fell $3.
Notebooks
Most notebook brands are cautious about panel purchasing, to avoid excess inventory. Some brands are buying more panels in Q4 to reach annual targets, but others built their inventory in Q3 and will carry that over to Q4. To drive the shipment target for the year, demand for the traditional ‘hot season’ rose sharply. Some notebook brands negotiated the sale of commercial models to the Chinese and Indian governments, to clear inventories.
Notebook order panel visibility is only good through November, says IHS. Many volume concession deals, and rumours of lower prices, have forced suppliers to reduce prices by $0.50 or more in October.
Mobile Phones
Strong seasonal demand meant that, overall, smartphone display prices fell more slowly in October. An increasing number of 1920 x 1080 displays are being adopted for mid-range units. IHS believes that this could lead to tight supply for these panels, and those with higher resolutions (FHD+), in Q4. Such a move would help to ease the decline of FHD+ panel prices in October, which fell $0.20 in October.
Tablets
The prices offered by white box (usually Chinese) panel makers, for tablet vendors cannot be matched by branded makers. Recently, Chinese module companies and agents have been eager to buy cell and open-cell tablet PC panels to prepare for new tablets from Amazon, Fuhu and RCA, as well as lower-priced products, for the Q4 holiday season. Panel prices remained flat.
