Seasonality was advanced to surface, shipment decreased by 9.2% in October.
According to WitsView’s Survey, worldwide aggregated large-sized panel shipments in October reached 33.9 million units, a MoM decline of 9.2% and a YoY decrease of 8.9% as well. As the global financial storm forces consumers and enterprises to significantly tighten their belts, the demand is exceptionally weak this year. Traditionally, for the preparation of year-end Christmas sales, panel shipment should have reached the peak in October, but it seems that the shipment track of 2H 2008 would not follow the past pattern and the peak should be in September. With the sluggish end market demand, panel shipment declines were seen in all three applications during October. Even though TV panels usually have a big jump in year-end sales, it decreased 5.6% MoM to 9.3 million units. Monitors were most affected by the weak seasonality, dropping 13.2% to 13.6 million units. As for NB segment, it also showed a decrease of 6.9% MoM to 11 million units.
Figure: TFT-LCD Panel Shipment (K units)
|
Application
|
Sep-08
|
Oct-08
|
MoM
|
|
TV
|
9,857
|
9,307
|
-5.6%
|
|
Notebook
|
11,794
|
10,982
|
-6.9%
|
|
Monitor
|
15,652
|
13,587
|
-13.2%
|
|
TTL
|
37,303
|
33,876
|
-9.2%
|
In terms of area shipments, they slipped from 6.4 million to 5.99 million square meters, a MoM decrease of 5.9%, due to larger TV panels kept their quantity in Oct., area shipments were seen a smaller drop. For TV panels, they dropped by 3.2% to 3.6 million square meters. By contrast, the weak seasonality effect on the IT portion was more notable, where Monitors fell 11.7% MoM to 1.6 million square meters, while NBs dropped by 6.9% to756K square meters.
Figure: TFT-LCD Panel Area Shipment (K square meter)
|
Application
|
Sep-08
|
Oct-08
|
MoM
|
|
TV
|
3,739
|
3,621
|
-3.2%
|
|
Notebook
|
800
|
756
|
-5.5%
|
|
Monitor
|
1,830
|
1,616
|
-11.7%
|
|
TTL
|
6,370
|
5,993
|
-5.9%
|
TV Panels
In October, TV panel shipments reached 9.3 million units, down by 5.6% MoM, but up slightly by 1.9% YoY. Amid the year-end sales season, it should have been witnessed the shipment peak in October. However, the influence by depressed economic environment makes market demand quite slack and the slow seasonality arises ahead of time. Except for the shipment ratio growth of 42”, 47”, 52”, 55”, other TV sizes went down compared to the previous month. Thus, the market share of 40” and above rose by 1.4 percentage points to 34.1%. The TV shipment screen size breakdown can be seen in the figure below.
Monitor Panels
The aggregated monitor panel shipments in October reached 13.6 million units, dropping by 13.2% MoM and 22.4% YoY. During the 2H of 2008, monitor panel shipments appear a totally different pattern with the past. From July 08 to date, accumulated monitor panel shipment just account for 58% of that in the 1H of the year. As entering the subsequent slow season, shipments are expected to decrease and it will be seen a smaller amount in the 2H. In October, only 16:9 widescreen products had increases, where the shipment ratio grew from 13.2% to 15%, other sizes slipped sequentially. The monitor shipment screen size breakdown can be seen in the figure below.
NB Panels
In October, NB shipments reached 11 million units, down by 6.9% MoM but up slightly by 4% YoY. Although it is impacted by the gloomy economic as well, a dark horse product—Net Book, with fashion style, thinness, power saving and low price— get market attention and become popular specially. Therefore, this segment still grows up despite the weak IT demand recently. As for mainstream NBs, it experienced the tightened purchasing power and saw significant decreases, where the shipment ratio of 14.1”w and 15.4”w fall by 22% and 7%, respectively. Meanwhile, in line with the trend of 16:9 widescreen monitor, new NB panel sizes with 16:9 spec had increases, where 15.6”w rose from 5.2% to 5.9% and 16”w rose from 4.7% to 5.8%. The NB shipment screen size breakdown can be seen in the figure below.
Conclusion
As mentioned earlier, the financial storm has severely impacted the market confidence and covers the demand with the shadow of uncertainty. Panel makers respectively cut back their production utilization and reach at an all-time low to weather the hard time. However, no evident catalyst is seen to inspire the market for the time being. Considering digesting the output and keeping inventory at a low level, industry participants still face the pressure in price competition, and it has a big chance to see 4Q financial result in the red. The priority at the present stage is to possess cashes in hand and reconsider the ramp-up schedule for the new production lines next year. It takes longer time to see the economic and consumer’s confidence recovery, which drives the demand rise.
