Taiwanese liquid crystal display (LCD) panel shipments jumped 74% sequentially to reach 1.6 million units in the fourth quarter of 2004, according to Market Intelligence Center (MIC), a Taipei-based ICT industry research house. The breakneck growth marks the first time Taiwanese LCD TV panel volume exceeded output from Korean rivals, which shipped 1.5 million units during the same period.
"In previous quarters Taiwanese makers had been working to boost output of higher-margin LCD TV panels, and by the fourth quarter a combination of higher 5G yield rates and brisk demand for LCD TVs 30-inches and up generated an explosion in panel growth," explained Annabelle Hsu, Senior Industry Analyst with MIC.
"And as Taiwanese panel suppliers close the technology gap with Korean players, the resulting influx of volume is driving price competition throughout the East Asian panel industry -- competition that is ultimately driving end-market demand " added Hsu.
Such oversupply-induced price declines, combined with peak season effects, generated a new high in East Asian LCD panel volume. MIC has placed East Asian panel shipment volume at approximately 38.3 million units for the fourth quarter of 2004, 30% growth year-on-year.
According to MIC, panel produced by Taiwanese makers totaled just over 17 million units, accounting for 44% of East Asian shipment volume and leading Korea's 16.7 million figure. Japanese makers, who have gradually shifted over to small and medium size panel production, saw shipment volume drop to roughly 3.8 million units.
Samsung remained the largest producer worldwide in the fourth quarter, followed by LG.Philips, which stayed in second place despite expansions on its 6G and second 5G lines. AUO and CMO shipped the third and fourth highest volume, respectively.
Of the major large panel applications supplied by the three major national industries in the fourth quarter of 2004, Taiwanese persisted in supplying the bulk of LCD monitor panels, while South Korean players remained the top panel suppliers for notebook PC.
Despite the general state of oversupply, a shortage of 17" LCD monitor panel still emerged in the fourth quarter. MIC pointed out that as demand for 17" models thrived due to the narrowing price gap with 15" models, panel suppliers were unable to switch over production lines in time. In the LCD TV segment, 20" and 32" models were also met with robust demand, which in light of the minority of players capable of supplying 32" panels, created tight supply of these panel sizes as well.
In presenting their outlook for the East Asian LCD panel industry in the first half of 2005, MIC noted that price erosion would likely be sustained due to aggressive capacity expansions and price competition from newer entrants BOE-OT, Innolux, and SVA-NEC. "Unless demand in the end-market picks up at a stronger pace than is expected, we anticipate oversupply to persist," said Hsu.
Such declines are likely to restrain aggregate shipment value, even despite the progressive movement toward larger sizes. However, MIC expects that certain panel sizes such as 17", 20", and 32"will see a slower pace of price decline given the popularity of models using these sizes in the end market.
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About MIC
Market Intelligence Center, based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends, focusing on markets and industries in Asia-Pacific. MIC is part of the Institute for Information Industry. https://mic.iii.org.tw/english