What They Say
Earlier this week, DSCC published a blog article summarising the situation on LCD TV panel pricing, describing the situation as a ‘Perfect Storm’ with
- Continued oversupply
- Near-universally weak demand and
- excessive inventory throughout the supply chain
Every screen size of TV panel has reached an all-time low price and the firm sees no signs of an increase ‘any time soon’. After slowing in Q1, price drops accelerated in Q2, but should flatten now. Prices for sizes less than 75″ are now below cash cost for most suppliers, so makers are reducing their utilisation.
Inventory continues to build for panel makers with LGD at an all-time record of 81 days at the end of Q2.
The article looks at prices per sq metre and this is in a range from $99 to $110 for panels up to 65″ with the 65″ ‘premium’ disappearing although 75″ still earns 50% more per sq meter than 32″ at $144.
TV set prices have also fallen from more than the base index level of 100 in 2014 to a new all time low of 41.4 in April and are now down to 33.1. Set prices are expected to further decline to 31.3 by December, 64% lower than the peak in June 2021.
What We Think
Over the years, I have often talked about the industry as having periods of low panel pricing when set makers were happy, but panel makers miserable and vice versa as each exploited a better position. However, the sad news at the moment is that because it is set demand that is weak rather than supply chain imbalance alone that is causing the bad conditions, the pain is pretty universal and that means that both set and panel makers will be pushing hard on everyone in their supply chains and will be under severe pressure from their customers, too. Tough times. (BR)
