Display Panels For TVs Likely to Cost 10 Per cent More: Counterpoint

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  • Coronavirus epidemic has impacted panel production as well as consumer demand
  • Korea-based Samsung and LG may be the least affected
  • A total of 15 million TVs were shipped in India in 2019

Due to the manufacturing slow down caused by the coronavirus lockdown, panel prices are likely to rise by around 10 per cent. This hike in price, as per Counterpoint, may increase the price of the finished good. However, the expected lack of demand will likely offset the development.

Global markets, especially North America and Europe, will face demand-side issues, due to the coronavirus lockdown. People may postpone purchase decisions due to economic uncertainty and to avoid social interaction.

In India, a total of 15 million TV sets were shipped during 2019. The country is dubbed to be one of the most promising markets for the TV business.

What are the TV panel makers doing

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Out of the top global brands, Samsung, which has TV manufacturing facilities in Hungary, Czech Republic, Mexico, and Vietnam, was relatively less affected at the beginning of the outbreak. But with Hungary closing its borders and the Czech Republic locked down, Samsung may face difficulties operating its European facilities. Samsung’s Vietnam production line has not faced any issue so far.

LG display’s manufacturing facilities in Gumi and Paju in South Korea have not reported any slowdowns yet, except a minor lockdown in the Gumi research facility, so LG’s panel supply should stay normal.

Xiaomi reported that it will be cutting its domestic (China) TV supplies by 20 per cent this month, and between 10 to 15 per cent in April this year. TCL’s panel manufacturing subsidiary, CSOT has its facility in Wuhan, and Wuhan being the epicentre of COVID-19 outbreak, TCL is likely struggling to run the panel manufacturing facility.

Last year, TCL shipped 32 million TVs globally, but in 2020 it will likely see around a 10 per cent decline due to the panel supply shortages and lower global demand. Hisense also assembles TVs in Hungary, so it may face issues similar to Samsung. But its Guangdong facility is coordinating with other factories to ensure the supply.

Other brands using panels from companies including TCL, Skyworth, BOE in their TVs will also be affected as the Chinese manufacturing sector slows down after the outbreak.

Taiwanese panel producer, AUO said its production operation was not much impacted by the pandemic and that 95 per cent of its production capacity in China has resumed. Thus, it is not changing its outlook for 1Q 2020. However, if the coronavirus continues spreading across the world, consumer demand will be impacted from 2Q 2020.

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