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Price Drop in Large LCD Panels Speeds Up
LCD Prices
Price Drop in Large LCD Panels Speeds Up
  • By matthew
  • September 26, 2013, 05:24
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LCD panel prices continue to decline in September. After the government subsidies ended in China, recovery is not up to expected levels. The price drops are increasing, which is highly unconventional considering the 4Q TV shopping season is coming up.

According to market researcher NPD DisplaySearch, LCD panel prices for 40-42 inch edge LED TV on September 19 were at US$240, seven dollars lower than two weeks prior.

46 inch LCD panel prices have also dropped from US$325 to US$318 in the same period. 50 inch panels have dropped by US$15, from US$336 to US$321. Looking at 3Q 2013 alone, the price drops have increased from July to August and from August to September. LCD panel prices for 40-42 inch LCD panels, which were at US$257 near end of July, dropped by six dollars to US$251 near the end of August. However, the price drop almost doubled from August to September, during which the prices fell by eleven dollars to US$240 near end of the month.

Large panels are directly related to the TV market. Therefore, even if there’s a price decline in 1Q and 2Q, prices generally recover prior to 4Q when the demand recovers. 4Q is a shopping season that includes China’s National Day in October, US Thanksgiving in November, and Christmas at year’s end. TV and other household electronics enjoy a heightened demand in this period. As such, TV makers increase panel purchases in 3Q, which lifts the prices. The industry is puzzled that the price drops not only continue but increase in 3Q 2013. 

The continuation of price drops is due to the fact that demand recovery is not up to expectation including in China, the world’s largest TV market. After the Chinese government ended its subsidy policies for energy-saving household electronics, TV sales dropped and have not yet recovered. Furthermore, an oversupply of inventory is still accumulating, negatively affecting demand. TV makers that suffered from poor sales have tried to sell off inventory and limit new panel purchases, but that has not been enough. Furthermore, unlike Korean and Taiwanese panel makers, Chinese panel makers have retained their volume at levels similar to last year, negatively affecting the oversupply status.