- Taiwanese large size TFT LCD (Thin-Film Transistor Liquid Crystal Display) panel shipments reached a new high of 14.8 million units in the second quarter of 2004, growing 17.4% sequentially and 71% year on year. In addition to heavy capacity expansions by panel suppliers, these dramatic gains were the result of urgent demand from customers looking to prepare for the peak retail season, as well as avoid a repeat of the panel shortages that plagued makers during the second half of 2003. Shipment volume was chiefly concentrated among the 14.1", 15", and 17" sizes, which accounted for 82% of total volume.
Notebook PC and LCD monitor applications amounted to 91% of panel shipments, while LCD TV panels for the first time surpassed 6% of volume. Given the lower than expected performance of the notebook PC market in the first quarter of 2004, prices and profits for this application lagged behind panels for LCD monitor. Suppliers subsequently shifted capacity to LCD monitor panels, resulting in a 20% sequential volume gain of panels for LCD monitors. Panels for notebook PCs consequently exhibited a slight decline in volume.
Sizes for LCD monitor applications were mainly 15" and 17", yet volume growth of 15" and 19" sizes was the most rapid. Although, 14.1" and 15" comprised 92% of notebook PC panel shipments, 12" panel share rebounded. 20.1" panels accounted for 47% of LCD TV panel volume.
Second quarter ASP (Average Selling Price) was at its highest since the first quarter of 2002, reaching US$264 due to the increasing volume of higher priced LCD monitor and LCD TV panels. Shipment value grew 129% year on year to total US$3.9 billion. However, toward the end of the second quarter the end market appeared to be faltering; combined with aggressive capacity expansions by panel makers, the rise in ASP shows signs of deflating.
In the third quarter of 2004, should end-market performance lag expectations, the improving yield rates on fifth generation lines will result in oversupply. This situation may be further intensified by the swelled inventories derived from earlier shortage fears. Taiwanese large size panel ASP is hence expected to slip in the third quarter, while growth in shipment value will be limited.