Global top-tier TV makers cut shipment plans for 3Q24 by 7%, grow cautious about panel buying plans.

Recent surveys indicate that global major TV makers are revising their LCD TV shipment forecasts downwards, reflecting weaker than expected seasonal demand from August onward. Both Samsung and LG Electronics have cut their shipment plans for 3Q24 by an average of 10%. Similarly, Chinese top-tier TV makers have also reduced their shipment targets for 3Q24 by 5% compared to forecasts from a month ago. Overall, the top major global TV makers, have lowered their 3Q24 shipment plans by 7%. Consequently, they are also scaling back their panel purchasing volumes for 3Q24 and are approaching in 4Q24 panel replenishments with caution.

Chinese makers made strong purchases from 2Q24 to 3Q24 but became cautious for 3Q24

In 2Q24, top-tier Chinese TV makers’ panel purchases increased by 3% quarter-on-quarter (QoQ) but saw a decline of 6% year-on-year (YoY), approximately 4% lower than previous forecasts. The rise in panel prices and demand being pulled-forward resulted in strong panel purchases during this period.

However, the results for 2Q24 were weaker than anticipated as Chinese TV makers became wary of the risks associated with higher inventory levels. Moreover, ongoing price negotiations, including those related to market development fund (MDF), remained unresolved. Chinese TV makers are concerned about some panel makers’ reluctance to lower panel prices as requested. In addition, due to the slow recovery of the global market - marked by poor demand in China, declining profit margins in North America, and the risk of rising inventories if TV sales fall short of demand in 3Q24 - Chinese TV makers remain cautious with their buying plans for 3Q24. Despite these challenges, they remain committed to driving shipments throughout 2024.

In 3Q24, top-tier Chinese TV makers are expected to maintain strong panel purchases, although the figures are slightly lower than earlier projections. Omdia forecasts a 1% decline QoQ, but a 4% increase YoY (Figure 1), which is about 6% lower than the last forecasts.

Figure 1: Top-tier Chinese makers’ TV panel purchases, 2021–24 (F), July 2024 update

Looking ahead to 4Q24, it is projected that top-tier Chinese TV makers will see lower demand for panels, as seasonal demand tapers off, panel prices face the risk of decline, and inventory management becomes a priority.

South Korean purchases rose in 2Q24. but demand fell in 3Q24

South Korean TV brands’ saw an 11% QoQ increase in panel purchases for 2Q24, which exceeded the past two years but remained much lower than 2021 levels. Although South Korean TV makers were initially expected to increase their panel purchases in 3Q24, both Samsung and LG Electronics became more conservative in July revising their shipment plans for 3Q24, which have fallen by 10% compared to previous forecasts. Consequently, their purchasing plans for 3Q24 have been scaled back, with a decrease of 6% QoQ and a decline of 5% YoY (Figure 2).

Figure 2 Samsung and LG stats

Both Samsung and LG Electronics are expected to lower their panel purchasing volumes for 4Q24 maintaining a conservative outlook on market demand to keep their inventories at healthy levels by the end of the year..

However, South Korean TV makers remain concerned about potential significant shifts to their LCD TV panel supply in 2024. This concern is due to uncertain developments, such as LG Display potentially selling its Gen 8.5 LCD fabs in China to a Chinese panel maker (either China Star or BOE) and Sharp SDP shutting down its Sakai Gen 10 fab in Japan in September 2024. Given the possibility that LG Display’s LCD fab in China may be acquired by China Star, Samsung plans to increase its panel orders with HKC Display to maintain its bargaining power. Conversely, if BOE acquires LG Display’s LCD fab in China, it will be important to observe how Samsung adapts to this dynamic change in its panel supply portfolio.

Further analysis covering display market trends and industry forecasts prepared by Omdia’s Display practice can be found here.