TrendForce：H1’13 panel sales determined by Chinese New Year and May 1st holidays

According to the survey conducted by WitsView, the display research division of the global market intelligence provider TrendFroce, and its Chinese partner Σintell, in December 2012, China top 6 TV brands showed a better-than-expected set shipment of 6.1918 million units, growing 18.5% MoM, to a historical new high. The full-year shipment in 2012 reached 51.459 million units, climbing 27.3% YoY and accounting for 24.9% of the worldwide LCD TV shipment volume. However, the panel procurement for December dropped 9% to 6.119 million units, while the entire 2012 panel procurement attained 52.709 million units, seeing a dramatic YoY growth of 37.5%.   

WitsView’s research director Burrell Liu indicates that the December shipment growth was mainly bolstered by China top 6 TV brands’ advanced replenishment for the 2013 Chinese New Year. Meanwhile, the average inventory level climbed to 8.1 weeks at the end of December. As a result, brands started to adjust inventory level, the demands for LCD TV sets and panels are projected to trim 15% and 30%, respectively. 

The 2012 ranking of China top 6 brands by shipment shares is: TCL (25.2%), Hisense (20.6%), Skyworth (17.8%), Konka (14.4%), Changhong (12%), and Haier (10%). Since LGD lifted its open cell panel shipment proportion in Q3’12, it has showed growing share in Chinese market and took the position of No.1 panel suppliers to China top 6 TV brands in December, controlling a 22.3% market share, moreover, CSOT gained the No.4 position in December. In view of panel makers’ ranking by 2012 full-year shipment share to China top 6 TV brands, INX’s 27% and AUO’s 19.2% held the No.1 and No.2 places, respectively, followed by LGD’s 18.2%, SDC’s 12%, CSOT’s 11.2%, and BOE’s 8.8%. (Figure 1)  

Figure 1. Panel makers’ ranking by 2012 shipment share to China top 6 TV brands

Source：WitsView

According to WitsView, although the LCD TV sales performance for New Year in China grew 3.5% YoY, still lower than brand makers’ projection, it contributed limited improvement to the inventory issue. The market anticipates an around 10% YoY growth in Chinese New Year TV sales as this year’s New Year promotional period is longer than last year. Based on our observations, in the condition of stagnant economy, the Chinese domestic market showed rapidly climbing LCD TV penetration rate after the stimulus packages such as “appliance going to the countryside” in 2009 and “energy-saving subsidy policy” in 2012, and the effect of “cutting price in exchange of lifting volume” gradually wanes.  

Recently, yen’s dramatic depreciation may encourage currency depreciation competition among export-orientated Asian nations, weakening China’s export competitiveness. It remains to be seen if Chinese government will plan and activate a new round of policies to boost domestic demands. While China’s following economic remedy is excluded temporarily, face with market fluctuations in peak and slow seasons, panel makers’ business strategies such as capacity adjustment, new product development, new technology application, and global client planning are all like two ends of the balance, any declination may bring unavoidable risks.