Oversupply causes flat panel pangs

Samsung LCDA combination of declining prices and oversupply of LCD TVflat panels is causing many manufacturers to rethink their strategy and to revise their buying tactics.

The problem is largely caused by a a lack of demand in the important Chinese market, with a number of major manufacturers including Samsung, LG Display, BEO, AU Optronics and Innolux to change their plans.

According IHS senior analyst Nick Jiang: “Panel inventory adjustment and stagnant sell through have caused TV makers in China to become more conservative in their panel purposes.”

He said that the conservative approach this year is a “major shift” from an aggressive market in 2014.

That, in turn, has caused the manufacturers of display makers to be left with too much stock. That will likely mean panel prices will fall further at the end of the year.

Data showed that in the first half of this year, panel manufacturers shipped close to 30 million TV display panels to Chinese TV makers, representing a 15 percent year on year growth.

However that all changed in the third quarter with manufacturers shipping 15 million panels, a 16 percent year on year decline. The same trend is likely to continue in this, the fourth quarter, Jiang said.