Quarterly TV shipment for 3Q21 reached 52.51 million units, representing an 8.3% QoQ increase but a 14.7% YoY decrease, according to TrendForce’s latest investigations. Demand for TVs was constrained during the quarter by the increase in various country’s vaccination rates as well as the rising retail prices of TV sets, resulting in a YoY shipment decline despite the arrival of the peak season. It should be noted that prices of TV panels began to plummet in August, and this price drop enabled Chinese TV brands to both expand sales during the Singles’ Day (November 11) shopping festival and in turn make up for deficits in their yearly sales targets. Global brands, on the other hand, will be unable to capitalize on the price drop of TV panels by reflecting this cost-savings on their TV sets’ retail prices until 1Q22 due to factors such as production, transportation, and inventory adjustments. These brands are therefore having a difficult time increasing their TV shipment for 4Q21. Quarterly TV shipment for 4Q21 is expected to reach 59.13 million units, representing a 12.6% QoQ increase but an 10.3% YoY decrease. TV shipment for 2H21 will therefore likely be among the lowest compared to shipment volumes for second halves of previous years historically.

TrendForce further indicates that TV manufacturers’ shipment performances have been weakening this year as the market approaches the year’s end. Stimulus checks issued in the US resulted in persistently high TV shipment in North America in 1H21, with brands maintaining their procurement of TV panels, thereby driving up the prices of TV panels as a result. As the COVID-19 pandemic is gradually brought under control, and everyday life returns to normalcy in Europe and North America in 2H21, the pandemic-generated upswing in TV sales subsequently lost momentum. Furthermore, while prices of raw materials and transportation/logistics services remained sky-high, manufacturing costs of whole TV sets also underwent a sharp climb and were then transferred to consumers. Taken together, these factors quickly wiped out market demand for TVs. TrendForce therefore expects annual TV shipment for 2021 to reach 210 million units, a 3.2% YoY decline.

With a forecasted annual shipment of 6.8 million units for 2021, OLED TVs have become favored by various brands amidst rising manufacturing costs of TV sets

TV brands face various manufacturing-related challenges this year. Not only have panel costs, which account for the largest share of TV sets’ manufacturing costs, undergone an increase, but port congestions have also led to rising shipping costs and an extended lead time before TV sets can be delivered for retail sale. In addition to an uneven availability of various components, these aforementioned obstacles all exacerbate the risks involved with TV brands’ shipment. In a bid to maximize profits, however, brands have been making a concentrated effort to ensure that the production of OLED TVs remained free from disruptions in an effort to maximize profits.

As brands shift the focus of their sales efforts to OLED TVs, OLED TV shipment for 2021 is expected to reach 6.8 million units, a 72.8% YoY increase. This growth can primarily be attributed to an increase in OLED TV supply due to the expanded production capacity of LGD’s production line in Guangzhou, as well as the narrowing difference between LCD panel prices and OLED panel prices due to the sharp rise in the former in 1H21. In particular, LGE is set to take leadership position with an over 60% market share and a 91% YoY growth in its OLED TV shipment. Trailing behind in second place is Sony, which has been sourcing OLED panels from LGD. The Japanese company is expected to register a 53% YoY increase in shipment and possess a 20% market share. Panasonic, on the other hand, comfortably took third place with a 7% market share. Notably, Xiaomi and Sharp are the two dark horses with regards to OLED TV shipment this year with explosive YoY growths of 900% and 140%, respectively.

Major brands will concentrate on the high-end and large-sized segments, while smaller brands will continue to steadily develop mainstream products

While demand in the TV market recovers as the pandemic runs its course, TrendForce expects 45% and 55% of the total annual TV shipment for 2022 to take place in 1H22 and 2H22, respectively. TV shipment for 2022 will likely reach 217 million units, a 3.3% YoY increase, as brands are able to aggressively ramp up their TV shipments thanks to not only an undisrupted supply of panels, but also gradually stabilizing prices. For major brands, their focus will be on medium-sized and large-sized products and on products with substantial added values. Hence, the market share of large-sized TVs (including 65-inch and above models) will for the first time ever surpass 20%, with medium-sized (40-inch to 59-inch models) TVs remaining at a 55% market share. Although major brands are gradually exiting the small-sized segment, and smaller brands will have an easier time expanding their presence in emerging markets owing to gradually stabilizing prices, small-sized (39-inch and below models) TVs will see their market share drop by 1.8% next year to 25%. In any case, the primary target markets for major brands and smaller brands will not overlap next year.

For more information on reports and market data from TrendForce’s Department of Display Research, please click here, or email Ms. Vivie Liu from the Sales Department at vivieliu@trendforce.com

Continued price hikes of TV panels, as well as a simultaneous shortage and price hike of semiconductor components required for manufacturing TV sets have forced TV brands in 2021 to reduce the shipment of their mid- and small-sized TVs in favor of the more profitable large-sized, mid- to high-end TVs instead, according to TrendForce’s latest investigations. This shift is expected to propel the annual shipment of QLED TV for 2021 to 11.02 million units, a 22.4% YoY increase. On the other hand, OLED TV shipment for 2021 is expected to reach 7.1 million units, an 80% increase YoY. As such, both product categories are expected to break records in terms of shipment this year.

It should be pointed out that, as increased vaccinations in Europe and the US bring about an imminent easing of border restrictions, TV demand generated by the stay-at-home economy is likely to slow down. In addition, TV panel costs have remained sky-high and shown no signs of downward movement. Hence, TV brands are moving towards larger product sizes and better specifications in order to maximize profits and minimize the financial losses incurred by selling mid- and small-sized TVs, which have relatively low margins. Given the downscaling of these less profitable models, TV brands’ annual shipments will likely suffer a corresponding drop. TrendForce therefore expects total TV shipment this year to reach 220 million units, a 1.4% YoY increase.

Samsung’s Neo QLED series will help propel annual shipment of Mini LED backlight TV to three million units in 2021

There has been a sharp drop in the profitability of mid- to small-sized TVs this year. In response, during the replacement period between old and new models, market leader Samsung Electronics has not only lowered the retail prices of its QLED products to attract consumers, but also released its new Neo QLED lineup, which features Mini LED backlights and resolutions ranging from UHD to 8K. Samsung’s QLED TV shipment is expected to undergo a 17% YoY increase to 9.1 million units this year, the highest annual shipment in history. In particular, Samsung’s lineup includes about 1.5 million Mini LED backlight TVs, mostly with 65-inch and 55-inch displays, and these sizes account for 33% and 30% of the company’s total Mini LED backlight TV shipment, respectively, while the ultra-large, 75-inch model will account for 17%.

TCL, on the other hand, released a relatively affordable 75-inch Mini LED backlight TV in 2020, with a 65-inch model released this year. TCL’s annual shipment of Mini LED backlight TV for 2021 will likely reach 800,000 units. Apart from the aforementioned two brands, Xiaomi and LG are also eager to enter the Mini LED backlight TV market. As such, TrendForce forecasts a total annual Mini LED backlight TV shipment of three million units for 2021.

While brands expand their production lines for OLED TVs, LG and Sony are expected to seize nearly 80% of OLED market share

At the moment, OLED TVs have been attracting consumer attention in the high-end TV market primarily due to their excellent image quality through high color saturation and contrast. As LG Display installs additional OLED capacity via its Gen 8.5 production line in Guangzhou this year, there will likely be a corresponding increase in OLED TV supply as well as a diversification of OLED TV sizes. Also, annual OLED TV shipment is expected to break records once again this year, as brands are willing to expand their OLED TV product lineups because strategic reductions in OLED panel costs have now significantly narrowed the gap between the cost of OLED panels and that of equivalent LCD panels, thereby giving OLED panels a cost advantage that allows TV brands to reap increased profitability. With regards to TV brands, LG Electronics remains the industry leader in terms of OLED TV shipment this year with a market share of more than 50%, while Sony takes second place with a 20% market share. Other Japanese brands (Panasonic, Sharp, etc.) and Chinese brands (Skyworth, Hisense, Xiaomi, etc.) are likewise expected to experience shipment growths going forward.

For more information on reports and market data from TrendForce’s Department of Display Research, please click here, or email Ms. Vivie Liu from the Sales Department at vivieliu@trendforce.com

TSMC’s Fab14 P7 in the Southern Taiwan Science Park suffered a power outage on April 14th. The cause of the power outage was an accidental severing of an underground power cable during construction work nearby. According to TrendForce’s latest investigations, the facility accounts for around 4% of TSMC’s total 12-inch wafer foundry capacity and around 2% of the global 12-inch wafer foundry capacity, and TSMC is still assessing the exact figures for the wafers that have to be scrapped and the wafers that can be reworked.

According to the latest available information, power was fully restored to the fab site at 7:30 p.m. on April 14th. The diesel uninterruptible power supply (DUPS) of the facility kicked in instantly when the power cable was cut, but there was still a short period of power interruption and voltage drop. As a result, some of the equipment systems in the facility temporarily experienced operational irregularity or malfunction. Based on past experiences with this type of incident, TrendForce believes that it will take 2-7 days to recalibrate the equipment systems so that they can return to normal operation.

For TSMC, this power outage incident has had implications on both revenue and production. With respect to revenue, TrendForce’s own analysis indicates that the disposal of the wafers that are too damaged for rework will bring about a revenue impact of US$10-25 million. This amount represents less than 0.1% of TSMC’s annual total revenue.

On the other hand, with respect to production, the Fab14 P7 facilities contain 45/40nm and 16/12nm production lines, and the outage will primarily impair end products including smartphones and automobiles, since automotive chips, which are in extreme shortage at the moment, are manufactured at the 45/40nm nodes, and 45/40nm capacities are among the most insufficient among all foundry capacities.

TrendForce further indicates that clients whose wafer inputs for automotive MCU and CIS logic products (manufactured at the 45/40nm nodes) are bearing the brunt of the outage’s impact mainly include NXP, Renesas, and Sony. In particular, Sony CIS 40nm Logic products are primarily supplied for high-end smartphones. However, as Sony manufactures these products in its in-house facilities as well, even if TSMC were to fully discard this batch of wafers, Sony’s supplies will remain relatively unaffected in the short run.

On the other hand, after the automotive market entered a gradual recovery in 2H20, automotive MCUs have been in shortage due to automakers’ insufficient inventory. Furthermore, a fire broke out at Renesas’ Naka-based 12-inch fab on March 19, and the fab’s cleanrooms were severely damaged as a result.

As of now, manufacturing operations at the Naka fab have yet to resume. Since TSMC has been allocating some of its production capacities in Fab14 to these products as a substitute for the Naka fab, TrendForce believes that the power outage incident will likely exacerbate the shortage of automotive MCUs going forward.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com