Impact of COVID-19 Revenge Spending... Sharp Rise in TV Panel Prices

Source: TrendForce

[Asia Economy Reporter Changhwan Lee] This month, prices for TV liquid crystal display (LCD) panels have surged sharply. It is estimated that the demand shortage for panels occurred as TV consumption, which had decreased in the first half of the year due to the spread of the novel coronavirus disease (COVID-19), rebounded significantly in the third quarter. Domestic display companies also reduced LCD panel production, which had an impact.

According to market research firm TrendForce on the 23rd, TV panel prices have recorded a double-digit increase this month. By size, 32-inch panels rose 15.8%, 55-inch panels increased 13.7%, and 65-inch panels went up 6.9%.

TrendForce analyzed that the recent rise in TV panel prices is due to major TV brands accumulating panel inventory amid increased TV demand.

In fact, demand suppressed by the COVID-19 situation has recently rebounded significantly, especially in the US and Europe. KB Securities estimated that Samsung Electronics’ TV shipments last month surged 90% year-on-year to 4 million units, while LG Electronics’ shipments increased 38% to 2.6 million units.

The sharp increase in TV sales is attributed to the resumption of economic activities in major TV markets such as North America and Europe since June. In particular, the US government’s COVID-19 disaster relief payments of up to $3,400 for a family of four have led to pent-up consumer sentiment being directed toward major home appliances including TVs, washing machines, and refrigerators.

As TV sales increase, major brands such as Samsung Electronics, LG Electronics, and TCL are competitively increasing TV shipments, which is also a factor driving up TV panel prices. Additionally, domestic companies like Samsung Display and LG Display reducing LCD panel production has also had an impact. Samsung Display and LG Display plan to reduce LCD panel production and focus on producing higher value-added panels.

The industry expects strong TV sales to continue through the third and fourth quarters. This is because consumer sentiment is reviving with the reopening of global economic activities, and demand for premium TVs is expected to continue due to the activation of remote work and the untact economy.

Market research firm Omdia forecasted that global TV shipments in the third quarter of this year will reach about 50.5 million units, a 17% increase compared to the second quarter. It also predicted that shipments will reach 63.54 million units in the fourth quarter.

This content was produced with the assistance of AI translation services.