Abstract
In 2006, global shipment volume of large area TFT-LCD panels reached 270 million units, with shipment value reaching US$49.5 billion, posting respective growth rates of 29.4% and 13.9% in comparison with 2005. Shipment volume in 2007 is expected to hit 320 million units, bumping up the shipment value to over US$55.3 billion. Annual growth rate for both, however, is projected to slow down slightly, mainly because the industry is now at the end of the growth stage in its lifecycle. Several trends are playing a key role in the industry. The abundance of production lines and further capacity increases may lead to price pressure and price competition. Also, the industry's focus is shifting towards TV applications. This report will provide an in-depth analysis of these trends, and give a detailed forecast for the overall large area TFT-LCD panel industry.
Price Pressure to Persist in Large Area TFT-LCD Panel Industry
During the period 2005-2011, the shipment value CAGR of the worldwide large area TFT-LCD panel industry is estimated at 10.8%, while that of shipment volume is expected to reach 16.8%. This puts the industry in the mid to late growth stage, which makes it prone to price competition. Foreseeing uncertainty in the market, large area TFT-LCD panel makers have been either reducing production or delaying new production line expansion plans. These strategic moves will have direct impact on the shipment volume CAGR in the coming years.
ASP of LCD monitor and notebook PC panels has been significantly lower than that of the overall large-area TFT-LCD panel industry, while at the same time, the combined volume share of the two applications accounts for over 70% of the industry's total volume. With the shipment volume share of higher-priced LCD TV panels still unable to surpass 30%, considerable shipment value CAGR growth for the overall industry is not expected in the coming years.
Comparison of the industry's shipment volume and value CAGR shows that the former continues to be higher than the latter, though just slightly. Consequently, in the next few years, though the worldwide large area TFT-LCD panel industry may avoid price competition, price pressure is expected to persist.
Industry Focus Shifting towards LCD TV
During the period 2005-2011, LCD monitor will be moving from late growth into the maturity stage of its lifecycle. Its market scale is close to saturation, rendering weak momentum for future growth. As a result, the shipment volume and value share of large area TFT-LCD panels for the LCD monitor application will experience declines in the coming years.
Notebook PC application is expected to edge up slightly in both shipment volume and value share. This is mainly due to the desktop replacement effect as well as the demand induced by Vista and wireless connectivity for notebook PCs with widescreen panels and multimedia functionality.
The outlook for LCD TV panel shares, both in shipment volume and value, is projected to be more positive than for LCD monitor and notebook PC panels. This is primarily because in recent years, affordable prices have stimulated LCD TV purchases in the consumer market. With the start of large area TFT-LCD panel production in 7.5G and 8G plants, more capacity is becoming available for LCD TV panel production. Therefore, LCD TV panels will continue to register growth both in shipment volume and value. It is obvious that the large area TFT-LCD panel industry is shifting its focus from the PC applications to TV applications.
Appendix
Glossary of Terms
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a-Si |
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amorphous-Silicon |
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ASP |
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Average Selling Price |
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CAGR |
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Compound Annual Growth Rate |
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LTPS |
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Low Temperature Poly-Silicon |
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OS |
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Operating System |
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TFT-LCD |
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Thin-Film Transistor Liquid Crystal Display |