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Excess inventory softens Japan quake impact on LCD panel vendors, market

Posted: 26 Mar 2012 ?? ?Print Version ?Bookmark and Share

Keywords:LCD panel? display market? LCD manufacturing?

Some facilities operated by LCD panel and component suppliers were affected by the 2011 earthquake in Japan. However, its apparent overall effect in the market one year later proves to be minor as Japan has a limited presence in the display business and had a serendipitous overhang of inventory, according to the IHS iSuppli Display Materials and Systems report.

"A decline in a major country's market share and a buildup in excess inventory normally are regarded as unfavorable developments for a technology market," said Sweta Dash, director of LCD research at IHS. "However, in the LCD market of 2011, Japan's limited presence in the global supply chaincombined with excess stockpiles in the channelhelped soften the blow of the manufacturing disruptions caused by the disaster."

Only five percent of large-sized LCD panel manufacturing capacity and just 18 percent of small- and medium-sized LCD manufacturing capacity was located in Japan in the third quarter. In comparison, Taiwan accounted for 40 percent of large-size capacity and 55 percent of small and medium. Because of this, disruptions to Japan's manufacturing and shipments had only a minor impact on the global LCD market.

The figure attached presents the percentage of global large-sized and small- and medium-sized LCD panel manufacturing by region.

TFT-LCD panel capacity

TFT-LCD panel capacity by region, Q3 2011. Only five percent of large-sized LCD panel manufacturing capacity and just 18 percent of small- and medium-sized LCD manufacturing capacity was located in Japan in the third quarter.

Inventory saves the day
Panasonic, Hitachi and NEC were the only three panel suppliers whose fabs were impacted because of their proximity to the earthquake's epicenter, while Sharp's eighth- and 10th-generation fabs were not impacted at all.


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