Thanks to TV manufacturers’ aggressive procurement activities, global TV panel shipment for 1H21 reached 135.2 million pcs, a 3.5% YoY increase, according to TrendForce’s latest investigations. Notably, high-end OLED TV panels and 8K LCD TV panels showed diametrically opposed movements. The former product category reached a 2.6% market share in 1H21 (with room for further growth going forward) due to LGD’s capacity expansion as well as the narrowing gap between OLED panel prices and LCD panel prices. On the other hand, the latter’s market share fell to a mere 0.2% in 1H21 as panel suppliers were generally reluctant to manufacture 8K LCD TV panels due to these panels’ poor yield rates.

TrendForce’s findings indicate that Chinese panel suppliers were able to achieve a 58.3% share in the TV panel market, which was nearly 5 percentage points higher than their 1H20 market share, thanks to their growing number of production lines. Conversely, Taiwanese suppliers saw their market share drop by 2.2 percentage points from 1H20 levels to 21.1% in 1H21. This decline took place because of their limited production capacities and because they reallocated some of their production capacities for TV panels to IT products instead. Korean suppliers likewise experienced a decline in market share to 14.3% after SDC shuttered its Korea-based LCD fabs L7-2 and L8-1-2 and sold its Suzhou-based Gen 8.5 fab to CSOT. Finally, Japanese suppliers’ market shares increased to 6.3% as a result of SDPC’s Gen 10.5 capacity expansion.

Regarding OLED TV panels, which are relatively high-end products, it should be pointed out that LGD is the sole supplier of these panels. Not only did LGD expand the production capacity of its Guangzhou-based OLED panel fab, but LGD’s clients in the TV sector were also increasingly willing to procure OLED panels in light of the narrowing gap between OLED panel prices and LCD panel prices. Hence, the penetration rate of OLED panels in the TV panel market grew to 2.6% in 1H21, with about 3.556 million pcs shipped throughout the period. Furthermore, now that the Guangzhou fab’s OLED panel capacity reached 90k sheets/month in 2Q21, TrendForce expects annual OLED TV panel shipment for 2021 to reach 8 million pcs, with a 3% penetration rate in the overall TV panel market.

On the other hand, 8K LCD TV panels reached a mere 0.2% penetration rate in the TV panel market in 1H21 because panel suppliers’ concerns about profit and yield maximization resulted in their relatively low willingness to manufacture these products. On the demand side, clients were also unwilling to procure these panels due to persistently high quotes from suppliers. With regards to panel suppliers, CSOT in particular benefitted from the unique structure of its client base, which allowed it to dominate more than half of the 8K LCD TV panel market, with AUO taking second place. The respective market shares of CSOT and AUO currently sit at 54.4% and 22.6%. TrendForce forecasts a 0.2% penetration rate for 8K LCD TV panels for 2021 as the growth of these products is constrained by their relatively high prices and the current paucity of 8K content.

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

The stay-at-home economy brought about a soaring demand for TVs, which in turn resulted in a shortage of TV panels in 2H20, according to TrendForce. Also contributing to the bullish rebound of TV panel quotes last year was the fact that most panel manufacturers rapidly decreased their supply of TV panels around this time.

After the upturn of panel quotes kicked off in late 2Q20 and came to a temporary slowdown at the end of the year, this upward momentum once again intensified in mid 1Q21 without warning, and clients on the purchasing end were caught off guard as a result.

TV brands are now at the mercy of panel suppliers since panels are an irreplaceable component in the production of TV sets. Being unable to effectively address the shortage and price hike of TV panels during the current surge in TV sales, TV brands have no choice but to react by buying up TV panels as they become available, thereby further driving up prices of TV panels.

Upward trajectory of TV panel quotes will likely taper in 3Q21 after TV brands successfully retool their procurement strategies.

The movement of prices in the panel market suggests that TV panel quotes will most likely peak at the end of 2Q21, plateau throughout 3Q21, and face downward pressure caused by an expected easing of demand for TVs in 4Q21. Although fourth quarters have traditionally been peak seasons for TV sales, TrendForce expects such major seasonal discounts as Black Friday sales to be cancelled this year in light of persistently high panel prices. TV sales in 4Q21 are therefore expected to be relatively muted as well.

On the other hand, as more and more of the general public receive vaccines, recreational activities, at least in developed countries such as the US, are expected to gradually move from the confines of indoor environments to the great outdoors.

Should this transition take place, TV brands and distributors alike will conservatize their outlooks of TV sales and of safe inventory levels, respectively, with brands lowering their panel procurement and distributors performing appropriate inventory adjustments. TrendForce analysts expect that TV panel quotes will enter a bearish trend in 4Q21 and gradually return to a cyclical downturn in 1H22.

（Cover image source: Samsung Newsroom Taiwan）