According to MIC (Market Intelligence Center), an ICT industry research institute based in Taipei, Taiwanese large-area TFT-LCD (Thin Film Transistor-Liquid Crystal Display) panel shipment volume is expected to grow 11% sequentially to about 41.8 million units in the second quarter of 2007 as panel makers are expected to clear inventories in the second and third quarters of 2007, boosting their capacity utilization rates. Moreover, the third quarter will also see the advent of the peak season for various application products. Although market demand is forecasted to continue growing sequentially in the third quarter, shipment volume is foreseen to score only limited growth, due to the overall capacity bottleneck in panel production.
No new large-scale capacities are scheduled for inception in the worldwide TFT-LCD panel industry in the second half of 2007, while shipment shares of larger-sized panels for various consumer applications are expected to rise further. Due to the relatively high prices of large-area TFT-LCD panels, makers are expected to allot most of their capacities to meet the demand in the large-area segment. Small-area TFT-LCD panel capacity will be compressed as a result, leading to shortfalls in small-area panel supply. The shift of production towards larger-area panels and strained supply are expected to further boost the overall Taiwanese TFT-LCD panel ASP.
Although the first and second quarters are the traditional off-seasons, the Taiwanese large area TFT-LCD panel industry managed to maintain a robust shipment performance in the first quarter of 2007. Shipment volume reached 37.7 million units in the first quarter, and only dipped 4.1% sequentially.
The unexpected strong shipment performance can be attributed to a number of factors. First is the growing demand from emerging markets, which was most evident in the Asia-Pacific region featuring strong growth momentum during the Chinese New Year. Second is the upgrade demand for PC-related products, which served to carry over brisk consumer demand from the fourth quarter of 2006 to the first quarter. Third is the enhanced awareness of supply chain inventory management. Panel makers scaled back production and brand-name vendors rapidly reduced inventories in the fourth quarter of 2006, leading to rather low inventory levels in January and February, prompting system makers to restock inventories starting in March.
Affected by continuous declines in the prices of end-products, ASP (Average Selling Price) of TFT-LCD panels for various applications dropped in the first quarter. However, the decline in ASP has slowed down thanks to the increase in shipment share of large-area TFT-LCD panels.
With shipment volume and ASP suffering sequential declines, Taiwanese large-area TFT-LCD panel shipment value slipped 9.9% sequentially to US$5.2 billion in the first quarter of 2007. Compared with the same quarter in 2006, the figure only represents a 0.1% decline.
More information can be found in the following MIC reports:
The Taiwanese Large Area TFT LCD Panel Industry, 2Q 2007
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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