Panel Makers LCD TV Target Growing by Only 3 Percent in 2015, as They Shift to Larger Sizes

We collect business plans of TV panel makers in the Quarterly LCD TV Value Chain & Insight Report, and the current 2015 target is 257M, up only 3 percent Y/Y from 2014, which is 249M, as described in the Quarterly Large-Area TFT Panel Shipment Report. However, 2015 will show strong area growth, as large panels are expected to grow substantially.

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Large area LCD TV panels expected to grow substantially

Source: Quarterly LCD TV Value Chain & Insight Report, Quarterly Large-Area TFT Panel Shipment Report

As shown in the figure, panel makers such as AUO and Sharp are limited by capacity, so are not able to increase unit shipments, but are focusing on larger size panels. For example, AUO plans to decrease 39”, and increase 50” and 55” in 2015. AUO is also planning to increase its Gen 8 capacity on the order of 15,000 input sheets per month, enabling it to increase production of larger panels. Sharp also plans to increase its 60” production in 2015, and develop ultra-large sizes like 120”. Innolux is also limited by capacity, as it has not built any new factories for the past three years. Innolux’s 2015 business plan is flat at 49M. However, the company plans to increase its capacity at existing Gen 6, 7 and 8 lines. In addition, Innolux will invest in its Gen 8 fab to better utilize the fab space and the increase the efficiency of the equipment.

LG Display is converting some of its Gen 8 capacity to oxide backplane to manufacture OLED TV panels. At the same time, it is expanding Gen 8 capacity in Guangzhou. The incremental increase planned for 2015 will be in larger sizes such as 43”, 49” and 65”. Samsung Display is likewise expanding its Gen 8 capacity in Suzhou. Samsung Display plans to decrease 32” production, and to increase 40”, 48’, 55” and 65” and larger sizes.

BOE is planning on a 24 percent Y/Y growth, based on its increasing capacity, especially its Gen 8 fab. ChinaStar is planning to expand its capacity through its second Gen 8 line at the end of 2015, and is planning for 26M TV panels in 2015, with the growth mainly in 55”. While CEC-Panda’s planned growth is mainly in 32,” it is planning to start 65” production in 2015.

The three Chinese companies will be the only ones to increase 32” supply in 2015, and the total 32” supply will fall from 78M in 2014 to 75M in 2015. 32” has fallen from 39 percent of the total LCD TV panel shipped in 2013, to 31 percent in 2014, and it is expected to be 29 percent. However, 32” remains the typical size for the first LCD TV purchase, especially in developing countries. In addition, 32” production is very efficient in Gen 6, 7 and 8 lines, so panel makers will continue to produce it.

Meanwhile, demand for smaller LCD TV sizes continues, especially in developing markets like South America. Sizes of 26” and less, especially 23.6”/24”, demand remains level at 26M in 2015.

As shown in the table, larger sizes will continue to increase, as 40” replace 39”, 43” takes share from 42”, 48” replaces 46”, 49” replaces 47”, and 55” diminishes the growth of 50”. While 50” will only grow from 16.7M in 2014 to 17.1M in 2015, 55” will jump from 16.7M in 2014 to 24.1M in 2015. Meanwhile, 39” will fall dramatically from 9M in 2014 to 3.6M in 2015, as Innolux has shifted its focus to 39.5” (40”), and AUO has also phased out its 39” FHD models gradually and to focus on HD only.

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This column was reprinted with permission from DisplaySearch and originally appeared here.