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China flat-panel TV market up for robust growth

Posted: 31 Mar 2008 ?? ?Print Version ?Bookmark and Share

Keywords:flat panel TV? market report? China? CRT TV? LCD?

Flat-panel TV shipments in China hit 9.6 million units in 2007, comprising of 8.8 million LCD TV units and 0.8 million plasma TV units. The market is forecast to grow at a CAGR of 29 percent from 2007 to 2012, promising greater opportunities for market players. This is according to DisplaySearch in its Q1 08 Quarterly Global TV Shipment and Forecast Report.

Strong 2007
In 2007, shipments LCD TVs and plasma TVs in China grew 83 percent y-on-y and 43 percent y-on-y, respectively. This year, total TV shipments is forecast to grow 4 percent to 41 million units, while CRT TV shipments are forecast to drop from 30 million units in 2007 to 24 million units.

In 2007, most non-China foreign brands left the CRT TV business in China, but priced flat-panel TVs more aggressively than before.

"There had been at least a 30 percent pricing gap between foreign brands and domestic players, but it decreased to less than 20 percent in 2007," said Bing Zhang, TV market research director for DisplaySearch in China.

Foreign brands, like Samsung and Sony, showed strong growth in flat-panel TVs, with unit shipment share of 40.1 percent in 2007, up from 33.6 percent in 2006. The share of domestic players decreased from 66.4 percent in 2006 to 59.9 percent in 2007. According to the report, Hisense and Samsung topped domestic and foreign brands with unit shipment shares of 12.1 percent and 7.2 percent, respectively.

Market dynamics
DisplaySearch examined several China TV market trends in the report.

For LCD TVs, ASPs of 32-inch LCD TVs decreased less than $800 by the end of 2007. The 32-inch LCD sets remain the mainstream product with a 33 percent market share in China. LCD TVs smaller than 26-inch and larger than 40-inch grew moderately in 2007.

Meanwhile, 19-inch and 22-inch LCD TVs, which use adapted LCD monitor panels, grew rapidly. For large-size 40-42-inch LCD TV sets, shipments expanded quickly as LCD TV brands allocated sufficient panels from Gen 7 TFT LCD plants in Asia. In 2007, 40-42-inch sets accounted for 25 percent of the total LCD TV market in China and 46-47-inch LCD TV captured an 8 percent share (Figure 1).

Figure 1: LCD TV sets of 19-inch and 22-inch, which use adapted LCD monitor panels, grew rapidly in 2007.

Also contributing strong influence in the market are plasma TVs. According to DisplaySearch, the 32-inch Enhanced Definition (ED) PDP TVs emerged first in the world in China in 2H 07.

In the selling season of Q4 07, 32-inch ED plasma TVs grabbed 26 percent of all plasma TV shipments in 2007 due to aggressive promotions (below $666 ASPs) by domestic TV brands such as Hisense, Changhong, Haier and Konka. The 42-inch sets remained the mainstream size for plasma TVs with a 52 percent share. Although several brands introduced 52-inch LCD TVs, a large price gap of approximately $1,350 between 52-inch LCD TVs and 50-inch plasma TVs influenced many buyers to shop for less expensive 50-inch plasma TVs.

Rosy forecast
According to Bing Zhang, the China FPD TV market will exhibit a 29 percent CAGR from 2007 to 2012. Driving this growth are big events, like the Beijing Olympic Games in 2008 and the World EXPO in Shanghai in 2010, as well as anticipated rapid declines of flat-panel TV prices. Flat-panel TV shipments in China will reach 17 million units in 2008, split between 15.5 million LCD TVs and 1.5 million plasma TVs.

"2009 will be the year when LCD TVs will surpass CRT TVs in China for first time," Zhang noted. DisplaySearch also forecasts that Rear-Projection TVs will fade away from the China market after 2009. Figure 2 shows the China TV demand forecast by technology.

Figure 2: The China FPD TV market will exhibit a 29 percent CAGR from 2007 to 2012.

The China FPD TV market will continue to move to larger sizes and higher definition such as 1,080p (Full HD). The average size of LCD TVs is expected to increase from 34.4-inch in 2007 to 36.1-inch in 2012. PDP TVs will grow from 41.6-inch in 2007 to 44.7-inch in 2012.

Meanwhile, the share of 1080p LCD TVs will increase from 10 percent in 2007 to 40 percent in 2012, and 1,080p plasmas will increase from 2 percent of all plasma TVs sold in China in 2007 to 30 percent in 2012, said the report.

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