IHS has released its PriceWise panel pricing data for November.
Monitors
Mainstream (sub-22″) monitor panel prices dropped by $0.50 – $0.80, due to aggressive promotions by Chinese suppliers. The decline was higher in large (23″+) sizes: between $1 and $2. This was due to weak demand and the end of holiday preparations.
IHS expects monitor panel shipments to remain the same or increase slightly, due to rising capacity at new G8.5 fabs in China. Therefore, price competition will continue. Despite the fact that mainstream panel prices are now lower than costs, no suppliers plan on leaving the market. Price competition is forecast to continue through Q2’16.
Some monitor panel suppliers are expected to shift capacity to TV panels to avoid further losses. These companies will produce more UltraHD panels or low-cost TV models, to sustain capacity.
LCD TVs
Some leading TV brands will need to significantly slash panel demand, or refuse to add to purchasing volumes, in Q4’15, because inventory is the highest priority. TV makers demanded greater price concessions in November, without promising orders. These makers are cautious about building up inventories before the end of the financial year.
LCD TV panel makers have not decisively lowered fab utilisation; they are therefore ‘desperate’ to secure orders and are giving set makers big price concessions. Size competition is also creating tension in the industry. To sell panels, some makers are offering very aggressive prices to brands willing to add to their purchasing volume. Those brands want to drive more shipments in Q4, to avoid carrying inventory into next year. They also want to raise shipments after low results in the first half of this year.
Notebooks
Several PC brands have ‘rushed’ to place orders for notebook PC panels, planning to push new models now that Intel’s Skylake CPU has arrived. However, says IHS, ‘a few’ panel suppliers have decided to perform fab maintenance at the end of the year, as the more panels they produce the larger their losses will be.
Notebook panel prices are forecast to continue falling through the end of the year. Panel makers will lower notebook panel fab utilisation in Q1 and Q2’16, to avoid further losses. Korean and Taiwanese suppliers will allow Chinese companies to take over the mainstream models at lower prices.
In November, notebook panel prices fell gradually, down between $0.30 and $0.60, because of weak demand and the end of holiday preparations among set makers.
Mobile Phones
After a sharp price fall in the first half of 2015, smartphone module price erosion slowed in October and November. However, brands retain strong bargaining power, and pushed prices down on total solutions. Panel makers dropped the price of Full HD panels faster, to increase demand in the mid-range market.
Tablets
Due to the ‘Q4 hot season’ (including demand for new models from Google, Microsoft and Amazon), tablet PC demand is expected to keep growing over the coming months. Panel supply for some specific products, using Oxide TFT technology, will have yield issues and seasonally weak demand in Q1’16. This will result in output short of expectations. Panel supply will trend downwards over the next few months.
