© vinnstock Analysis | March 21, 2016

BOE surpassed Innolux to take No. 3 supplier spot

The latest large-size panel shipment report by WitsView, a division of TrendForce, says TV panel shipments for this February totaled 17.88 million units, representing a monthly decline of 8.7 percent and a year-on-year decline of 8.3 percent.

In addition to seasonal influence, the Chinese New Year holidays and the earthquake that struck Taiwan on February 6 all contributed to the shipment slump. Iris Hu, WitsView research manager, expects TV panel shipments to recover during March as Innolux’s fabs in Taiwan resume normal operation and panel makers begin to fulfill orders left from February. Another driving force will be TV brands stocking up panels for new product models. According to WitsView’s latest estimates, March’s TV panel shipments will grow by almost 20% compared with February. However, first-quarter shipments are projected to suffer a near 15% drop compared with the previous quarter as the market for TV sets remains generally weak. Off-peak season and delivery delays led to poor shipment results for panel makers in February
  • No. 1: LG Display (LGD) still topped the TV panel shipment ranking in February, but the panel maker has strategically cut its 32-inch panel production to avoid incurring a loss. Currently, the average price of the 32-inch panel is close to the product’s cash cost. Also, the Chinese New Year holidays had reduced the number of work days in February and caused delay in some orders. Consequently, LGD’s TV panel shipments fell 8.1 percent monthly to 3.83 million units.
  • No. 2: Samsung Display Corp. (SDC) posted a marginal monthly decline of 1.8 percent in its February shipments of TV panels, amounting to 3.38 million units. SDC’s January shipments were lower than expected due to delays in the client verification process for new panel products. As a result, the South Korean panel maker had a shorter base period for February shipments. Moreover, Taiwan’s earthquake disrupted the supply of 39.5-inch panels from Innolux, forcing TV brands to use SDC’s 40-inch panels as the alternative. This shift in orders helped keep up SDC’s overall TV panel shipments during February.
  • No. 3: BOE Technology (BOE) was the only supplier that increased its TV panel shipments against the seasonal headwinds in February with a monthly growth of 1.2 percent at 3.24 million units. BOE’s shipments were driven by the rising yield rates for large-size panel manufacturing and the demand for 32-inch panels, which helped the Chinese panel maker to maintain a high capacity utilization rate. At the same time, Innolux’s shipments were sharply reduced by the earthquake in Taiwan. This allowed BOE to move up to the No. 3 spot in the shipment ranking, with a volume difference of less than 150,000 units compared with the second-placed SDC.
  • No. 4: Innolux’s Fab 5 and Fab 6 in southern Taiwan suffered serious damage caused by the earthquake and were almost completely out of commission during February. Fab 6 in particular is a major production facility for the 39.5-inch TV panels. Besides the earthquake, Innolux’s shipments were also impacted by the seasonality and the absence of orders for the 23.6-inch panels. Overall, the Taiwanese panel maker delivered 2.66 million units of TV panels in February, resulting a significant monthly decline of 21.9 percent.
  • No. 5: TV panel shipments of China Star Optoelectronics Technology (CSOT) fell 8.9 percent monthly to 2.29 million units. Besides being affected by seasonality, CSOT had to cut its 32-inch panel shipments as the margin of this product was no longer profitable for the supplier.
  • AU Optronics (AUO) shipped 1.76 million units of TV panels in February, down 8.1 percent from the previous month. Fewer work days in February meant that AUO had to delay fulfilling some of its customers’ demand until March.
----- More information can be found at Trendforce.
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