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Large-screen panel prices are expected to continue to be lowered
In recent months, color TV manufacturers have started to prepare for the upcoming sales season ahead of the New Year. According to the latest data from Quzhi Consulting, global demand for TV panels remains robust in November and December. Since the end of Q2 this year, panel prices have been on a downward trend and are expected to continue declining into December, which could create more room for profitability across the industry.
Quzhi Consulting reports that 40-inch and 43-inch panel prices are projected to drop by an average of $3 in December, following the price cuts seen in November. Meanwhile, the demand for 50-inch large-screen panels has gradually improved but still lags behind supply. These larger panels are expected to see an average price drop of around $8 in December.
Looking ahead, demand is anticipated to rise during the first half of 2018. Large screens have become a major trend in the color TV industry in recent years. For TV manufacturers who have struggled financially over the past two years, focusing on large-screen, high-end models represents a key strategy to boost performance. According to Quzhi's data, global LCD panel shipments in 2017 remained roughly similar to the previous year, but the total panel area increased by 4% year-on-year, driven largely by growing demand for large TVs. The company expects global panel demand to grow slightly by 0.3% in 2018, with panel area potentially rising by 8.5%.
Quzhi Consulting also predicts that demand for finished TV sets will increase in the first half of 2018, influenced by several factors. At the end of 2017, main machine manufacturers maintained healthy inventory levels with low stockpiles. In early 2018, panel prices continued to fall, leading to improved profits for brands. Additionally, the World Cup event is expected to push new product launches forward into 2018.
Despite these positive signs, the expansion of panel production capacity is expected to have limited impact. Several new LCD panel production lines, including BOE’s Hefei G10.5 generation line and CEC’s Xianyang and Chengdu G8.6 generation lines, are set to start mass production in the first half of 2018. AUO’s G8.5 generation line expansion is also expected to begin full-scale production in July 2018, potentially increasing the panel production area by 10.8% year-on-year.
However, Quzhi Consulting believes that once these new lines come online, they will go through a period of ramp-up and yield improvement in 2018. As a result, the effective supply capacity for the TV panel market will remain constrained. In the first quarter of 2018, factors such as reduced working days in February and potential maintenance activities by panel makers could further limit the growth of global LCD TV panel supply in the first half of the year.