LCD Prices Plunge in Q4

DisplaySearch_Premiums+on+a+55+Edge-Lit+LED+LCD+TV_111227-0112According to the latest NPD DisplaySearch Quarterly TV Cost and Price Forecast Model, average U.S. street prices for all LCD TV sizes up to 46” will be below $1,000 for the first time, and all 32”, including high frame-rate LED models, will be below $500. Many other pricing milestones will be reached during the holiday season in 2011 as well, including:

  • 40” and 42” CCFL 2D LCD TVs will have average prices below $500 for the first time
  • 40” active (shutter glasses) 3D LCD TV will fall below $1,000
  • 47” passive (polarizer glasses) 3D LCD TV will fall below $1,000
  • 60” LCD TV will fall below $1,500, with some promotions for less than $1,000
  • 50” 1080p 3D plasma TV will fall below $1,000

These low prices reflect the difficult year many in the TV industry have faced. With slower than expected demand and excess production capacity, a persistent oversupply of inventory during 1H’11 led to a dramatic reduction in key component costs during Q3. As a result, these cost reductions enabled the bargains seen during Black Friday and beyond. However, the positive reaction by consumers to very low prices is also a challenge for TV makers.

Paul Gagnon, NPD DisplaySearch director of North America TV market research, said, “The flat panel TV industry is now in a very advanced state of maturity, and the rapid cost reductions seen in the mid-2000s due to enormous investments in panel production capacity have slowed considerably. Despite this, consumers still expect rapid continuous retail price reductions… In an effort to offer more value and entice consumers to focus less on price as a motivating factor, a number of new technologies, like LED backlights, higher frame rates and even 3D, were introduced to boost demand without resorting to price-driven tactics.”

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