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Market to suffer for first-ever annual decline in area shipments this year

In a historic first, the worldwide market for LCD-TV display panels is set to decline both in terms of unit and area shipments in 2019, as major suppliers cut production, according to Omdia.

Global LCD-TV panel unit shipments will drop by a steep 10-percent margin this year, declining to 257.8 million units, down from 287.2 million in 2019. Area shipments will decrease by 3 percent, declining to 158.2 million square meters, down from 162.9 million last year, as reported by the Omdia Large Area Display Market Tracker.

“The LCD-TV panel market will make history this year—but not in a good way,” said Peter Su, principal analyst, large display, at Omdia. “Area shipments are set for their first-ever annual decline in 2020 as suppliers reduce production and reorganize their manufacturing operations to pursue higher-value applications outside of the LCD-TV panel market.”

Table 1: Large area display unit shipment forecast

large area display unit shipments.png

Source: Omdia

Making up for 2019

The current production reduction represents LCD-TV suppliers’ reaction to oversupplied conditions in 2019.

“In 2019, excessive supply triggered by Chinese suppliers ultimately spurred record-breaking price declines for LCD-TV panels,” Su said. “As a result, Korean brands, which are less competitive on price, reduced or halted the operation of their LCD-TV panel production fabs. Moreover, Korean and Taiwanese manufacturers initiated efforts to transition their fabs to produce higher-value panels for IT applications. This is resulting in declines in unit and area shipments in 2020.”

Big declines for smaller panels

The decline in LCD-TV panel production this year is occurring in the main size range spanning from 32-inches to 55-inches. However, the 65-inch and larger category continues to see increased production. 

Area shipments of LCD-TV panels sized 65-inches and larger will rise 21 percent in 2020 to reach 47 million square meters. However, for panels smaller than 65-inches, area shipments will fall by 10 percent to total 111 million square meters this year.

The reduction in area shipment for panels smaller than 65-inches will be 12.9 million square meters this year, which is considerably larger than the area growth of 8.1 million square meters for 65-inches and larger.

Production rises for other applications

In contrast the television segment, shipments of large-sized panels for LCD monitors and notebook PCs is forecast to grow both in terms of units and area this year. Panel producers are serving the increasing demand for relatively high-value products like curved, wide-viewing-angle and high frame-rate panels. 

LCD monitors are mostly produced in the same fabs as TVs, meaning that more production will be allocated to producing LCD monitors, given that LCD monitors have relatively higher added value. However, price competition should intensify as demand for both LCD monitors and LCD notebook PCs slows. 

Table 2 shows that the trend for area shipments this year largely resembles that of unit shipments. LCD monitors are to record the largest annual growth of 13 percent followed by 3 percent growth for LCD notebook PCs and a 3 percent decline for LCD TVs. 

Table 2: Large area display area shipment forecast

large area display area shipments.png
Source: Omdia

China set to grab more market share in 2020
Looking at the overall market for large-area displays, China took the largest share in 2019 with 40 percent of total unit shipments and 41 percent of area. This represented the first time China exceeded Korea in terms of area shipment.

Omdia believes that China will continue its march toward greater market share in 2020. China will account for 45 percent of unit shipments and 49 percent of area shipments this year. BOE is projected to lead unit shipments, at 26.5 percent, followed by LG Display at 15 percent and Inolux right behind with 14.9 percent.