Large-size panel shipments fall by 4.9pc in 3Q08

TAIPEI, TAIWAN: Global aggregated large-sized panel shipments in 3Q08 reached 105.3 million units, a QoQ decrease of 4.9 percent and a mere 3.4 percent YoY growth, according to WitsView. 

Thanks to preparations for China's National Day holidays and year-end sales promotions, TV panel shipments were up monthly during the third quarter. For 3Q08, they reached a new record high of 26.7 million units, up 12.7 percent QoQ.

In the IT segment, in the wake of the sharp panel price falls in 3Q08, and the strong inventory pull-in during 1H08, it resulted in overly high inventory levels for both brand vendors and SIs during the beginning of 3Q08. In general, as the end market demand was severely impacted by the global financial turmoil, both consumers and enterprises tightened their belts. Due to the sluggish demand, NB panels instead fell by 3.7 percent QoQ to 34.1 million units. Monitors fell even more notably, down by 13.8 percent QoQ to 44.5 million units. On a yearly basis, this amounted to a decrease of 9.2 percent.

Table 1: Large-sized TFT-LCD panel shipment (K units)

It is interesting to note that some market share changes were seen during 3Q08. The TV and monitor market share of the Korean players increased 2.3 percentage points to 45.8 percent, thanks to their respective own-brand support and depreciation end of below G6 lines. For the Taiwan suppliers, their share was instead down by 2 percentage points to 46.1 percent. This was due to their more aggressive production cutbacks, and the sharp monitor panel shipment drop, which accounted for the largest share in their product mix.

Turning our attention to the Japanese players, the quarterly growth in TV shipments helped push its market share to 4.3 percent, up 0.7 percentage points. Finally, the China-based suppliers' share was down slightly to 3.9 percent.

Table 2: 2Q08 large-sized TFT-LCD panel shipment share by region (unit base)

Based on the performance of the respective panel makers, Samsung topped the list for all three applications, where it shipped a total of 24.63 million panels in 3Q08.

Table 3: 2Q08 WW large-sized TFT-LCD panel shipment ranking

In the wake of the production cutbacks by the Taiwanese panel makers and inventory adjustments during 3Q08, the current panel inventory has returned to a healthier level. Yet, the persisting macroeconomic troubles continue to weigh on the end market demand.

The uncertain demand and likelihood of panel prices falling further is rendering both the brand vendors and SIs to hold a cautious outlook toward 4Q08 and 1H09. Meanwhile, based on the current market conditions, the production cutbacks by the panel makers will likely continue for another 1 to 2 quarters.

Beginning from November, the traditional weak seasonality effect should become more evident. For 4Q08, shipments are expected to drop by 6~7 percent QoQ, according to WitsView analysts.