TV Panel Shipment Grew by 11% YoY in 1H18, BOE Ranked the Top for The First Time, Says TrendForce

According to the latest report by WitsView, a division of TrendForce, global TV panel shipments reached 136.89 million pieces in 1H18, a year-on-year growth of 11%. The record high shipments have ended the decline over the past two years. After a high price level in 1H17, the TV panel prices have been decreasing since 1Q18, which pushed brands’ panel purchases. Panel makers also offered special deal projects to increase the shipments, which further lowered the panel prices.

“The global TV panel production capacity will increase by 8.7% YoY in 2018 as the three new fabs enter the market during the year”, says Iris Hu, the research manager of WitsView, “therefore, specification or size upgrades will be a must for panel makers.” For the first half of 2018, Chinese panel makers still allocated considerable capacity to 32-inch panels, which accounted for 32.4% of the total shipments. This size recorded a YoY shipment growth of 26.2% in 1H18, and will boost the whole year’s shipments to a new high of 277.1 million pieces. However, the large share of 32-inch panels will also restrain the average panel size growth. For 2018, the average size is estimated to be 45.2-inch, a marginal growth of 0.6-inch from last year.

BOE surpassed LGD and ranked the top; Innolux ranked the third with special deal projects

BOE’s shipment of 65-inch panels increased QoQ by 381.8% in 2Q18, as its world-first Gen 10 fab entered operation. In terms of small size products, BOE has seen stable demand for 32-inch panels in 1Q18 thanks to stock-ups for the World Cup. As the demand has been pulled in the second quarter and its Gen 8.5 fab in Fuqing continued to ship products, BOE has offered special deal projects to consume the capacity of its 32-inch and 43-inch products. The company’s total shipments reached 25.625 million pieces in 1H18, a growth of 31.4% over a year ago. This is the best shipment performance among the six major TV panel makers, making the company surpass LGD and go back to the top of shipment ranking for the first time.

LGD has been trying to obtain higher revenue and profit from limited production capacity in order to compete with the large new capacity of Chinese panel makers. Therefore, LGD has decreased the share of 43-inch panels and increased that of 75-inch in Gen 7.5 fab, then decreased 49-inch and increased 55-inch and 65-inch ones in Gen 8.5 fab. Although the size adjustments affected LGD's shipments in the first half of this year, which saw a YoY decline of 4.3% to 24.199 million pieces, this adjustment strategy still works since the total shipments of 55-inch, 65-inch and 75-inch increased by 10.1% YoY.

Innolux was influenced by the poor demand for 39.5-inch and 50-inch panels, ending up with increasing inventory level and weak shipments. Therefore, Innolux also provided special deal projects in May and June to consume the inventory. Its shipments increased significantly to 5.11 million pieces in June, a new monthly high. In total, Innolux shipped 20.831 million pieces of TV panels in 1H18, a YoY growth of 2.9%, bringing Innolux to the third place in the ranking.

CSOT produced at full capacity to boost shipments, AUO recorded the most annual decline among the top 6

CSOT’s annual maintenance of its first Gen 8.5 fab (T1) in this March indirectly affected the production and shipment of the month, but the new capacity of its second fab (T2) has been operating at its full capacity from 2Q17, driving its 55-inch shipments to grow by 12.6% in the first half of this year. The total shipments of CSOT reached 19.292 million pieces, a YoY increase of 6.2%.

After the shutdown of L7-1 factory, Samsung Display (SDC) has adjusted its TV panel shipping strategy from keeping the shipment level to ensuring profitability. SDC has simplified its product mixes from last year to increase the effective production capacity and to maximize the production volume. Therefore, the company’s shipments of 55-inch and 65-inch panels still grew by 28.9% and 30.3% respectively in 1H18, even the demand weakened in the second quarter of this year, and its L7-2 and L8 factories had annual maintenance. SDC’s total shipments reached 19.281 million pieces, a YoY increase of 4.7%.

Although AUO has expanded the production of 25K sheet in its Houli Gen 8.5 fab, the new capacity will not be available until the second half of this year. In addition, AUO continues to expand its deployment in 65-inch and 75-inch panels, its high-end large-sized products, squeezing the capacity for other small and medium-sized products. AUO’s shipments decreased by 5.9% year-on-year in 1H18 to 12.492 million pieces, the most decline among the six major panel makers