2014 panel makers need high-end product card slots

December 27th, with the commissioning of the Samsung 8.5-generation line in Suzhou, there will be a new round of panel production capacity in mainland China. According to AVC's statistics, in 2014, three 8.5-generation lines will be put into mass production in mainland China. Confronted with the rapid increase in production capacity on the one hand and the slowdown in market demand on the other, panel companies urgently needed high-end product card slots in 2014 to seize market opportunities and enhance their profitability.

(I) In 2014, the panel production capacity in Mainland China surged and the prices continued to drop. At present, there are 4 main high-generation lines in China, and there are 12 future plans. With the completion of several 8.5-generation lines, the production capacity of glass substrates for the Y8 line in mainland China will increase from 250,000 per month at the end of 2013 to 670,000 per month at the end of 2015. This means that within two years, China's eighth generation line capacity will increase by more than 260%.

From the second half of 2013, the price of LCD panels has been declining, and the profits of major screen makers have gradually declined. The main reason is that the impact of the European debt crisis still exists. The global color TV market is affected by the overall slowdown of the world economy, and there are signs of weak growth. The macroeconomic downturn has led to depressed consumer confidence. Coupled with the property purchase restriction policy, inflationary pressures, surging cost, and the withdrawal of demand stimulus policies, sales of color TV sets have shown signs of decline since the second half of 2013. Avid Consulting (AVC) expects sales of color TVs to decline 5.5% year-on-year in 2013. On the other hand, major panel makers have maintained a high rate of shipments for the purpose of reaching the full year shipment target, leading to short-term oversupply of TV panels, panel prices continued to fall, and panel prices for 32-inch HD and 50-inch FHD have almost bottomed out. Ovid Consulting (AVC) predicts that large-size panel prices will continue to decline in 2014, and the decline is expected to weaken before the onset of the May 1st Golden Week in the second quarter of 2014.

(II) With the rise of UHD market, panel makers are actively deploying card slots. High-end market For panel makers, it is critical to use the new technology products to obtain high profits or improve existing profitability. The panel maker not only looks forward to gaining revenue directly from the new product itself, but also hopes to use new products and new technologies to enter into the current wave of rising LCD TV revenues to gain economies of scale.

In 2013, the concept of UHD and OLED gradually entered the consumer's field of vision as the stimulation of concepts such as 3D display technology, LED backlighting, smart TV, and Internet TV waned. However, due to the high cost of upstream materials required for OLED TV panels and low manufacturing yield, OLED TV panels have low shipments and are expensive. It is difficult to reduce prices in the short term. Currently, most brands maintain Wait and see attitude. As a consumer can intuitively feel the effect of technological upgrading, UHD as the vanguard of non-commitment, has become a pioneer in the color TV industry in the second half of 2013. In-depth analysis of the reasons for the rise of UHD, OVC Consulting (AVC) believes that the main internal and external factors contribute to the formation.

External causes:

The ultra-high definition screen market launched by mobile phones and PAD products has brought a visual feast to consumers and brought new opportunities for television products. In the Chinese mainland market, UHD has become synonymous with high resolution and has become a selling point for marketing. The upcoming World Cup in Brazil will also contribute to the promotion and promotion of UHD TV.

In addition, under the fierce competition in the Chinese domestic market, Chinese TV manufacturers need to actively develop their export business. UHD can be used as a new opportunity to open up overseas markets.

Internal reasons:

The profit driven by panel makers is a key reason for pushing UHD. The production threshold of UHD LCD panels is relatively low, and the input cost is low. For large-scale TFT-LCD manufacturers, relatively large-scale OLED panels require relatively less capital for additional investment.

Entering 2013, large-size products have become the mainstream market trend. The larger the screen size, the better the high-resolution picture quality. Taking into account the effects of the visual experience in the terminal market, the large screen size also creates the precondition for the promotion of UHD. condition.

In terms of prices, the price of 4K TVs has gradually become pro-independence with the joint efforts of the upstream LCD panel makers and TV manufacturers. With the development of the market and mass production, the price of UHD will become more civilian. Ovid Consulting (AVC) believes that when the price difference between the same size fresh product and the existing LCD TV product is about 1.2 times, the consumer acceptance is high. Entering 2014, UHD's price is expected to be closer to the people, which will help it further seize the market.

The Taiwan Panel Factory Group launched a full-size UHD panel in 2014, and the mainland panel maker Huaxing Optoelectronics and BOE would also launch 49- and 55-inch series. According to panel makers, South Korea’s Samsung and LG’s 2014 UHD shipments will reach 7 million. Ovid Consulting expects that the sales volume of UHD TV in mainland China will reach 8 million units in 2014.

Like all new industries, UHD Ultra HD TV industry also has some problems. For example, there may be less content, different standards, etc. In general, the UHD related industrial chain still needs to be improved in the country, and it will take a certain period of time to cultivate the market.

Ovid Consulting (AVC) expects the sales of UHD (Ultra High Definition) television in China will reach 8 million units in 2014, and 2014 will be the UHD outbreak year. As a new round of promotional selling points, all major machine companies have used UHD product cards to set up high-end markets to create new opportunities and profit points.