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China suppliers show biggest growth in LCD panel space

Posted: 13 Jun 2012 ?? ?Print Version ?Bookmark and Share

Keywords:LCD panel? LCD market? panel suppliers?

Chinese suppliers represent the fastest-growing contingent of the LCD panel market in 1Q12, according to IHS iSuppli's LCD Market Tracker report.

Although South Korea brands still dominate the market, Chinese firms capitalized on the rising production and strong domestic demands for 32-inch televisions.

Among the top LCD panel suppliers, China's Beijing Optoelectronics Technology Co. Ltd. (BOE), which is ranked No. 5, achieved first-quarter shipment growth of 18.6 percent, the best performance among the Top 10 suppliers. No. 7 player Infovision Optoelectronics Co. Ltd. (IVO), also of China, increased its own shipments by a slightly smaller 18.3 percent, the second-best results for the Top 10.

However, it was two newer Chinese entrants that were not ranked among the Top 10 that saw the most explosive growth in the first quarter. CEC achieved a 63.5 percent expansion, while China Star Optoelectronics Technology more than doubled its shipments with a 103.3 percent increase, by far the largest growth in the market.

"The Chinese players are cashing in on the country's fast-growing demand for 32-inch panels used in televisions," said Sweta Dash, senior director for liquid crystal displays at IHS. "Meanwhile, the Chinese suppliers are ramping up production, allowing them to expand shipments at a fast pace. Both BOE and China Star have new 8.5-generation fabs, which will allow them to compete with other suppliers that possess similar next-generation fabrication facilities, especially in the television market. The Chinese manufacturers also are benefiting from new tariffs levied by their government, which are creating challenges for their overseas competitors."

The table shows the latest Top 10 rankings in the global large-sized LCD space, with market share listings based on unit shipments in the first quarter of 2012 compared to the fourth quarter of 2011. Large-sized LCD panels are defined as those with a diagonal dimension larger than 10 inches.

LCD panel ranking

China brings new tariffs, rising competition
China's tariffs in April increased to 5 percent for imports of LCD panels sized 32-inches and larger, up from 3 percent before. The higher tariff has the potential to erode the market share of Taiwanese suppliers, because they now have such a large market share in China.

With overall opportunities tightening in the mature large-sized LCD panel market, partly because of the rising tariffs and increased competition from China, established suppliers based outside China are in the process of figuring out their strategies to outmaneuver the competition. Some are focusing on value-added or more differentiated products, such as high-resolution or 3D panels, while others are moving into new TV panel sizes like 39-inch or 50-inch. While the Chinese players focus on the 32-inch panel market, the Taiwanese suppliers prefer to supply the most efficient panels that could be made in older Gen 7.5 fabs in order to avoid direct competition with their mainland rivals.

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