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Large LCD panels to be in oversupply, says iSuppli

Posted: 22 Sep 2005 ?? ?Print Version ?Bookmark and Share

Keywords:tft-lcd? tv? pc monitor?

Despite strong sales of larger thin-film-transistor (TFT) liquid crystal display (LCD) panels in the second quarter, slower-than-expected system production and end-system sales for flat-panel TVs and desktop PC monitors will exacerbate an expected oversupply of panels toward the year's end, according to market research firm iSuppli Corp.

According to the firm, global demand for large TFT-LCD panels increased to 48.4 million units in the second quarter, up 16 percent from 41.6 million in the first quarter. The LCD-TV segment grew the fastest, with panel shipments rising 26 percent to 5.4 million units as value-brand and white-box television manufacturers stocked up to meet fourth-quarter holiday demand.

But iSuppli expects rising energy prices, lower consumer confidence and slower economic growth to slow the increase in large LCD panel demand the rest of the year. Moreover, the firm said the transition to larger-sized TFT-LCD panels is progressing more slowly than expected.

Second-quarter shipments of 32-in. LCD-TV continue to lag those of 20-in. VGA panels for PC displays, which accounted for 28 percent of total units the second quarter, said iSuppli. Panel makers had expected the 32-in. size to become predominant.

The slower-than-expected transition has raised concern as LCD suppliers continue to pour hundreds of millions of dollars into Generation 6 and later fabs to handle large TV panels. Stronger first-half shipments of smaller displays indicate that prices for large TFT-LCD panels remain too high compared to other technologies, iSuppli believes.

Last week, Samsung Electronics Co. Ltd reportedly said it would consider scaling back LCD capital investment because of lagging profits. iSuppli also reported that inventories of 19-in. flat-panel desktop PC monitors were beginning to accumulate at suppliers, forcing some to lower production capacity. Monitors comprise the largest consumer of larger TFT-LCD panels at 58 percent, the firm said. LCD monitor prices are projected to fall the fourth quarter, iSuppli predicts.

Spencer Chin

EE Times

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