LCD prices set to soar

Major LCD TV brands are expected to increase production during the second quarter of this year, with monthly production growing by 15 percent from February to March.

A further six percent increase month on month for April will follow, according to DisplaySearch , despite an inventory adjustment by top brands.

In the first quarter of 2011 the leading 17 LCD TV brands planned to produce 41.1 sets, and are now targeting 44.8 million units, an increase of nine percent quarter on quarter.

Japanese brands Sharp and Panasonic are planning for lower growth or reduced production following the March earthquake.

That’s in contrast to Chinese set makers such as Changhong which will see double digit quarterly growth.

Supply chain inventory is at a healthy level, says Displaysearch, due to substantial price cuts seen at the end of last year. New TV models are already in the pipeline and on the way to stores.

But Yang highlights that “research indicates that LCD TV brands tend to err on the cautious side, prioritizing inventory control and adjusting production plans as needed” in case sales in main markets are not as good as expected.”

February production was only slightly less than expected, by five percent, though March estimates will be capped at nine percent because of slow sales and weak demand in Japan.

Affects will vary between brands with some reporting double digit growth while others noted slight declines.

Samsung’s LCD TV production is steady at three million over the first six months, while LG plans to raise production from 2.3 million units in February to 2.6 million units in June – as in the graph below.

Chinese TV production will peak in April, though preparation for the Labor Day shopping season will see raised production in March, April and May, with shipments to the Chinese market increasing.