News from November 24, Beijing time, Agency: It is expected that TV panel prices will further decline in the fourth quarter. Research organization Omdia recently released the "Display Panel Industry 2021 Summary and 2022 Outlook (Part 1)". The report pointed out that it is expected that there will be an oversupply of TV panels in 2022, but the second quarter will show a reversal.
The report shows that demand has fallen sharply, especially in the third quarter of 2021, when the surplus rate of large-size display panels rose to more than 10%, leading to oversupply in the third and fourth quarters of 2021.
Looking ahead to 2022, Omdia said that it is expected that there will continue to be an oversupply of panels in 2022. As panel prices may fall to the bottom in the first quarter of 2022, starting from the second quarter of 2022, due to the promotion and sales of the FIFA World Cup, panel demand will increase; when the bottleneck of components is alleviated, panel demand will also resume.
It emphasized that panel pricing strategies and demand elasticity will be crucial in the first quarter of 2022-panel manufacturers must determine the extent of price cuts to stimulate demand again. At the same time, since the demand for TV will change drastically in the post-epidemic era, the price of TV panels will likely show two cycles within a year with changes in supply and demand.
It is understood that in 2021, many panel suppliers will change their TV production capacity to IT production capacity, especially in the eighth generation and smaller factories, because the demand for IT panels is stronger.
Looking ahead to 2022, the report pointed out that in 2022, more panel manufacturers plan to transfer the additional LTPS TFT LCD production capacity in their 5.5-generation and 6-generation plants to the production of automotive display panels and notebook computer panels. Chinese panel makers have already transferred a-Si TFT LCD production capacity to the production of notebook computer panels in 8.5-generation and 8.6-generation plants. With the increase in production capacity of LTPS TFT LCD in the 5.5-generation and 6-generation factories, the supply of notebook computer panels will increase in the next few years.
In terms of panel pricing, panel prices rose sharply in the first half of 2021, because panel manufacturers withdrew their panel demand due to a shortage of components. Therefore, panel demand dropped sharply at that time. However, panel demand decreased due to the relaxation of the blockade policy. High retail prices have begun to affect panel prices; TV panel prices will drop sharply in the third quarter of 2021. Omdia predicts that TV panel prices will fall further in the fourth quarter of 2021.
The demand for terminal TVs has increased in the coverage of vaccines in various countries, the price of the whole machine has risen, and the peak shipment season is not booming. However, looking forward to next year, as market demand returns to the right track after the epidemic, and the supply of panels and price trends have stabilized, it will be beneficial for brands to sprint out. It is estimated that next year’s shipments will reach 217 million units, an annual increase of 3.3%.
According to statistics from TrendForce, in the third quarter of this year, branded TV shipments reached approximately 52.51 million units, a quarterly increase of 8.3% and a year-on-year decrease of 14.7%. In the fourth quarter, driven by panel prices and Double 11 promotions, shipments will reach 59.13 million. Taiwan, a quarterly increase of 12.6% and a year-on-year decrease of 10.3%, but most brand manufacturers consider production, transportation time, inventory depletion and other issues, and do not tend to reflect the price difference of panel prices this season, and it is estimated that it will restrain some demand recovery. TrendForce also predicts that TV shipments this year will fall to 210 million units, a year-on-year decrease of 3.2%.
Looking forward to next year, TrendForce believes that market demand will return to the right track. Shipments are estimated to reach 217 million units, an annual increase of 3.3%. The TV shipment ratio in the first and second half of the year is also expected to return to the pre-epidemic level of 45:55. Among them, Medium and large size, high value-added products continue to be the focus of large-scale brand manufacturers, while small-size products have stabilized prices, and small brands have driven the growth of demand in emerging markets.
On the other hand, TrendForce pointed out that with the rising cost of TV sets, brand manufacturers, including LGD, SONY, Panasonic, Xiaomi, Sharp, etc., are sprinting OLED TV shipments in order to maintain maximum profitability, which will also drive the overall OLED TV this year. Shipments are better than the market average and are estimated to increase by 72.8% annually to approximately 6.8 million units.
Omdia expects that there will continue to be an oversupply of TV panels in 2022, but it will show a reversal in the second quarter. As panel prices may fall to the bottom in the first quarter of 2022, starting from the second quarter of 2022, due to the promotion and sales of the FIFA World Cup, panel demand will increase; in addition, when component bottlenecks occur again, panel demand will also recover. Cause a shortage.
There are several factors that will worsen the panel oversupply problem in 2022 until demand elasticity is reached again. Factors such as China's new production capacity, reduced panel demand after the COVID-19 pandemic, shortage of non-panel parts and logistics issues may lead to a double-digit decline in panel prices in the first half of 2022.
In 2022, Samsung Display plans to produce more than 1 million QD OLED TV panels, while LG Display plans to produce more than 10 million WOLED TV panels. Omdia expects panel demand to become saturated in the first half of 2022. The utilization rate of panel makers in the first quarter may be lower than in the fourth quarter of 2021, and the decline in panel prices will affect profit margins. However, it is expected to pick up gradually starting from the second quarter.
