IHS DisplaySearch has released its panel pricing data for late April and early May.
Weak IT demand in Q1 led to notebook vendors successfully driving down panel costs. IT demand is flat in Q2, but panel inventories are high and it is taking time to work through them. There has been pressure on notebook PC panel makers to lower prices; some have begun to shift capacity to automotive and smartphone applications.
Prices for notebook PC panels cannot be sustained this month, due to the capacity transition. IHS expects prices to fall, but notes that they may stabilise once the capacity conversion is over.
Replacement demand has become the driving force in China’s smartphone market, which is now mature. However, demand has been weak since the end of carrier subsidies last year. The eCommerce platform is developing, making up for some of the losses from the carriers’ distribution channels; however, these are usually high-value, premium products being sold. Low-priced handsets are having an impact on the upstream supply chain, and continue to reduce smartphone module ASPs.
Tablet PC demand has remained low in May so far, as white-box brands are cycling through their panel inventories. Top brands are expected to purchase more panels for new models in Q2. Overall, supply is flat or slightly down, and prices are also expected to be slightly lower than April.