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2020/07/27
The COVID-19 pandemic caused major disruptions in the TV supply chain in 1H20, including work stoppages and deferred deliveries throughout upstream, midstream, and downstream companies Various retail outlets were also forced to halt operations due to pandemic-induced lockdowns, further affecting TV brands’ shipment performances According to TrendForce’s latest investigations, total shipment of TV brands in 2020 is expected to reach a mere 21411 million units, a 17% decrease YoY, but a 4% increase from the previous forecast in March, during which the outbreak’s spread was at its most aggressive This increase in forecasted yearly shipment suggests that the stay-at-home economy generated by the pandemic is consistently gaining momentum
TrendForce analyst Iris Hu indicates that, for the past 10 years, TV brands have shipped approximately 46% and 54% of their shipment each year in yearly first halves and second halves, respectively Due to the pandemic’s influences this year, however, the share of branded TV shipment in 1H20 was 4-5% less than the first half averages of 46%, as brands look to shore up their yearly shipment targets in 2H20 by betting on the momentum of the stay-at-home economy
Chinese brands are expected to compress one another’s market shares as they aggressively expand in overseas markets
Although TV brands saw a 77% YoY global shipment reduction in 1H20, their shipment in North America during the same period increased by 20%, thanks to stimulus bills and unemployment benefits released by federal and state governments alike in the US, as well as the public’s increased TV usage due to WFH demands and stay-at-home orders In particular, VIZIO, which has traditionally centered its sales strategy on the North American market, is expected to increase its TV shipment this year by 176% YoY
In addition, TCL and Hisense, which have been aggressively expanding their overseas market shares in recent years, remained undaunted by the pandemic and saw increased shipment against the downtrend by maintaining extremely cost-effective and comprehensive product lineups On the other hand, given the overall weakened global shipment in 1H20 and the aggressive effort at capturing market shares by Chinese brands and VIZIO, the shipment performances of Japanese brands and minor brands in the second/third tiers plummeted from bad to worse
TV brands’ profitability faces further challenges in 3Q20 as 55-inch panel prices grow by more than 20%
TV brands are stepping up their panel procurement efforts in 3Q20 to raise their market shares and to reach their yearly shipment targets, in turn driving up TV panel prices as well As quotes for 55-inch panels in July 2020 return to July 2019 levels, they are now 25-30% higher than their low point at the end of last year However, regarding the unit retail prices of branded TVs, prices for 55-inch UHD models in the North American market in June fell by more than 30% YoY, while there was a noticeable surge of sales discounts and promotions for high-end models TrendForce believes that, despite the proactive push by TV brands in 3Q20, skyrocketing panel prices mean the balancing act between shipment volumes and profit margins will remain an unavoidable challenge facing TV brands
2020/05/21
The latest investigations from the WitsView research division of TrendForce shows that, owing to the COVID-19 pandemic, global TV shipment is expected to undergo a 58% decrease YoY and reach 20521 million units in 2020 In the shrinking TV market, brands are vying for business growth by demonstrating their technical superiority, and this may be achieved through either improving specifications or differentiating their products In particular, thanks to the marketing push of leading manufacturer Samsung VD, QLED TV shipment is projected to grow by 418% YoY, reaching 827 million units this year
According to TrendForce Research Manager Iris Hu, given that the general public in many regions are issued stay-at-home orders because of the pandemic, there has been a surge in the demand for TVs that are 43 inches and under, which are suitable for WFH usages In addition, the longer time spent at home means the public now also spends more time watching TV The demand for a better viewing experience unexpectedly resulted in a wave of replacement demand for 65-inch TVs by the end of April this year
Retail prices of 65-inch QLED TVs fell by more than 20% in 1Q20 and became a major selling point
Owing to its technical and cost advantages, last year Samsung VD was able to not only occupy more than 90% share of the QLED TV market, but also drive up the overall QLED TV shipment to 583 million units, a 230% increase YoY In spite of the downturn in global TV shipment this year, the market for QLED products thrived on the flourishing stay-at-home economy as well as the sales promotions of Samsung VD’s older models in 1Q20, which resulted in retail price cuts of more than 20% for 65-inch QLED TVs in the North American market, incidentally creating a wave of replacement demand for new TV sets On the other hand, as a relatively new entrant, Huawei made its foray into the TV market last year by releasing a pair of Honor Vision-branded smart TVs with consumer-friendly prices In 2020, Huawei is making a major push with QLED product development as its entry point into the high-end TV market The company is expected to compete with Vizio for the number two spot in terms of QLED TV shipment this year
The OLED TV market faces the dual headwinds of hindered panel supply and high retail prices
Leading OLED TV panel manufacturer LGD previously intended for its Gen 85 OLED fab in Guangzhou to begin mass production in 1Q20, but this plan did not take place on schedule because of certain technical constraints Furthermore, the mid-January onset of COVID-19 in China compelled Korean employees who performed technical roles at the Guangzhou fab to return to Korea These technical workers would not recommence their work at the fab until April, in turn delaying LGD’s mass production of OLED panels
On the other hand, although many TV brands, including Sharp, Huawei, Xiaomi, and Vizio, are releasing OLED TV sets this year, TrendForce does not have an entirely optimistic outlook on the future demand for ultra-high-end TVs Case in point, both market leader LGE and Sony have revised down their shipment targets for OLED TVs this year TrendForce projects OLED TV shipment to increase by a mere 78% YoY in 2020, for a total of 3375 million units, which is a 261% decrease from the original number forecasted at the start of 2020 Aside from the pandemic-induced slowdown in OLED demand, the more flexible pricing of QLED products will also represent a substantial threat to the sales of OLED TVs this year, since the latter have historically maintained a high retail price
2020/03/27
According to WitsView, a division of TrendForce, its latest TV research report shows that the threat of looming China-US trade war tariff covered the year 2019 Besides, consumers' habits of using TVs were changed, so demand was indirectly reduced Fortunately, brands' promotional campaigns during Black Friday and November 11 were helped by massive fall of TV panel prices in 4Q19 Thus, the TV set shipment only slightly declined by 08% YoY in 2019, reaching 2178 million units
In early 2020, COVID-19 outbreak began to spread All levels of governments in China refrained people from moving freely, in order to suppress the spread of outbreak TV brands that mostly center on China's domestic market suffered heavy losses of sales In March, China's epidemic situation is steadily being contained By contrast, the COVID-19 pandemic rapidly soars in Europe and America continents In addition, many countries' stock markets crashed, and financial markets were severely hurt These factors significantly damaged consumers' confidence of future economy outlook In particular, consumption toward non-essential products became more conservative
In addition, UEFA EURO 2020 and 2020 Tokyo Olympic Games that were supposed to be held in 2020 were postponed to 2021 because of the escalating COVID-19 pandemic Therefore, TrendForce decreased TV set shipment prediction quantity to 2052 million units in 2020, down by 58% YoY When the pandemic can't be effectively contained in the future, TrendForce might move down the annual shipment prediction again
In 1Q20, the shipment is reduced by 86% from the pre-COVID-19 forecast; that of 2Q20 is moved down by 73%
In 1Q20, the TV industry is currently pressed both on the production side and demand side TrendForce reduces its prediction of global shipment for 1Q20 to 446 million units, down by 86% from the pre-COVID-19 prediction (488 million units)
Particularly, China's sales portion in Xiaomi and Skyworth both exceed 70% In 1Q20, Xiaomi's shipment quantity fell from pre-COVID-19 prediction by 259%, and that of Skyworth dropped by 21% These 2 brands were hit the hardest Amid international brands, they suffered slightly in 1Q20 In contrast, as the pandemic ravages globally, all brands' shipments will eventually unavoidably decline TrendForce modifies its shipment prediction for 2Q20 from pre-COVID-19 prediction's 476 million units to 441 million units, down by 73% For the near future, brands whose Europe's shipment portion surpasses 30%, such as Samsung VD, LGE, Sony and Philips, might be next victims of the pandemic
End-market demand quickly falls, and panel price rise hike might be halted in 2Q20
TV panel prices rebounded in 1Q20 mainly because of 3 reasons below First, Korean panel makers began to shrink their capacities from the end of 2019 Next, majority of panel size segments' prices dropped below their cash costs Third, after Chinese New Year Holidays, factories across China postponed their work resumption schedules Therefore, panel supply decreased In 1Q20, the panel prices of 32" and 55" both grew more than 10% QoQ from 4Q19
By contrast, as the COVID-19 pandemic spreads worldwide in March, on the demand side, brands will definitely reduce their panel procurement quantity in 2Q20 TrendForce, as a result, predicts that the reduction scale might reach 8-10% On the supply side, panel supply steadily recovers to pre-COVID-19 levels When demand might fall and supply might increase, panel prices' negotiation power will shift from sellers to buyers in April In other words, the panel price hike will stop
2019/11/27
The latest analysis from the WitsView research division of TrendForce shows that global TV shipment in 3Q19 reached 5497 million units, a 168% growth QoQ and 19% decline YoY As China-US trade relations worsened in 2Q19, TV brands took on a speculative attitude towards stocking-up This attitude completely changed with the imminent arrival, towards the second half of 3Q19, of Double 11 in China and year-end festivities in Europe and the Americas, which are both shopping holidays that require companies to stock up Not only did TV brands actively ramp up their shipments, but they also hoped to make up for lost sales in 1H19 through large-scale sales promotions
According to TrendForce research manager Iris Hu, as brands stock up in preparation for year-end sales, 4Q19 shipment is projected to reach 6542 million units, a 19% growth QoQ After the sales prices across all panel sizes dropped below cash costs, panel manufacturers began reducing the production volume of panels in order to establish a price floor in 4Q19 Stabilized low prices of TV panels are expected to help brands plan their sales strategies
Nonetheless, the TV market is impacted by tariffs-related problems stemming from the China-US trade war In addition, the Chinese market is increasingly saturated, and Chinese customers have become less and less reliant on TV sets Even in light of Chinese brands’ active expansion into overseas markets, total TV shipment in 2019 is expected to decline by 1% YoY
Samsung’s Effective Pricing Strategy Doubles Its Shipment Share of QLED TVs
The first two places in terms of 3Q19 shipment were still occupied by Korean brands Market leader Samsung increased the market share of its QLED products by adopting consumer-friendly prices Samsung’s shipment of QLED TV in 2019 broke the 5-million-unit mark for the first time and occupied 25% of the market, doubling the previous year’s shipment share In total, Samsung reached 1041 million TV units, a growth of 17% QoQ and 68% YoY
On the other hand, LG Electronics (LGE), also based in Korea, notched shipment numbers of 744 million units in 3Q19, a 253% growth QoQ and 145% growth YoY Because most of LGE’s TV panels were supplied by LG Display, and because it assembled its TV sets in-house, LGE was able to achieve strong cost advantages, which translated into strong competitive advantages in the peak sales season
As TCL and Hisense Actively Pursue Overseas Markets, Xiaomi Looks for a Resurgence in Shipment via Low Prices
As the domestic demand in China became saturated, and Xiaomi aggressively pursued market share starting from 2018, the two largest Chinese brands TCL and Hisense quickly shifted their sales focus onto the international market TCL began exporting its products overseas since the beginning of 2019, with remarkable performances in North America, Europe, Latin America, and other emerging markets The company saw weak shipment numbers in 2Q19 due to uncertainties caused by the China-US trade war and an inflated shipment base period from preemptively stocking up in 1Q19 at the expense of 2Q19 shipment However, orders from overseas markets came in droves in 3Q19, driven by the arrival of peak season This, combined with TCL’s stocking up in August in preparation for Double 11, secured the company a 48 million unit shipment, a 14% growth QoQ, and a third-place global TV brand ranking
Hisense is continuing to expand its overseas market this year to include Australia, Europe, and Russia The company’s exported products currently occupy 50% of its total product shipment Thanks to the rising demand in both the domestic and overseas markets in 3Q19, Hisense reached an all-time high (for the company) shipment of 462 million units, a 486% growth QoQ
Fifth-place Xiaomi traditionally offered a lineup of highly cost-effective products to bolster its customer loyalty and increase market share Nevertheless, its performance during the 618 shopping festival in 1H19 did not meet prior expectations Xiaomi’s stocktaking in 3Q19 indirectly reduced its shipment by 83% to reach 275 million units The company aims to engage in an aggressive pricing strategy in 4Q19 to attract customers and generate a resurgence in shipment
2019/10/04
According to WitsView, a division of TrendForce, its latest survey pointed out that TV panel prices had significantly dropped for 4 consecutive months since May Prices of more than half of size segments have lowered to below cash costs
By contrast, panel prices of some size segments might shrink their price fall scale or even stop falling for 3 reasons First, Samsung Display (SDC) and LG Display (LGD) have steadily reduced some of their LCD capacities Next, Taiwanese and Chinese panel makers either moved down their capacities or changed their product mixes Third, the recent demand is from year-end promotional campaigns in Europe and USA and the demand is from China's November 11 e-commerce campaigns and stocking-up momentum between January 1 and Chinese New Year Holidays
Iris Hu, the research manager of TrendForce, predicted the outlook in 4Q19, 1Q20 and 2Q20 At the end of 2019, brands might conduct inventory control Besides, the upcoming 1Q20 is expected to be a typical traditional off season Therefore, the risk of price fall might rise, and capacity reduction scale might expand When might TV panel price stop falling and become stable? The answer might be 2Q20 when brands might start to stock up for their new spring product launches and Tokyo Olympic Games
The 32" panel price fall scale has shrunk, and might even stay flat in the short term
The average price to 32" TV panel is an indicator It has dropped for more than 20% since June 2019 It not only fell below the cash cost, but also approached the variable cost In this way, BOE Technology (BOE) who is the major supplier of the 32" reduced production, in order to decrease loss of money
After panel makers started to limit their production of the 32", in September, the 32" panel price fall scale might narrow to US $1 The lows of price range might even remain constant
On the one hand, in 4Q19, the demand from international brands might begin to weaken On the other hand, Chinese brands keep on stocking up for their sales on November 11 and sales between January 1 and Chinese New Year Holidays Therefore, the 32" panel price might remain stable until mid-November However, when the end of 2019 approaches, brands might conduct inventory control and a traditional off season might come Then the 32" panel prices might move down
The number of suppliers for 43" panels increased, so its price is hard to stabilize
Because panel makers are losing money, they gradually begin to transfer capacity Some moved Gen 75's capacity of the 50" panel to make the 43" Some increased the 43" production shares in Gen 85 or Gen 105 On the one hand, these factors show that the 43" is one of the few products that are still profitable On the other hand, the problem is that increasing supply makes price fall unstoppable In September, the 43" FHD panel supply rose because of panel makers in China, so its price might fall by US $3 When the supply and demand can't balance in the short term, the price might continue falling
During the peak season, demand to large-sized rose, so the price fall scales of the 55" and 65" were narrowed
Before November, it is China's year-end peak-season for promotional campaigns, and brands' demand to the 55" and 65" panels has grown In addition, prices of the 55" and 65" all fell below the cash costs Moreover, when panel makers cannot bear the loss of more money, the continuously-rising demand might help shrink panel price's fall scales Hence, in September, the price fall scales to 55" and 65" are both projected to narrow to below US $5 The price of 55" might temporarily remain constant because before the end of 2019, Korean panel makers reduce their supply Regarding the price of 65", because of oversupply, it is unlikely to stop dropping
