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TV Market: China Declines Sales Expectations

Autor: Markus Hevesi
05/07/2010, 13:02 CET

Despite being a future boom market for TV sets, sales figures at the Chinese Labour Day were disappointing. According to the news portal DigiTimes LCD TVs did not reach the expected sales figures of two to three million units. Instead, only two to 2.4 million TVs were sold.

This shows that Chinese customers tend to have an increasing preference for international brands. While 70 per cent of all TVs sold in 2009 originated from the People’s Republic of China, their share decreased to roughly 58 per cent in February this year. By the end of the year, this part will have decreased further to be levelled out at about 50 per cent. Within the five largest selling brands there already are three foreign companies, namely Samsung, Sony and Sharp. Due to price cuts as well as the introduction of particularly modern hardware with LED backlighting, Chinese Manufacturers Hisense and Skyworth both were able to maintain the top position.

In terms of large-format sets, TVs with an LED backlight could win through. They will have a 30 per cent share of all LCD shipments in the first half year, which to the end of the year will have increased even up to 50 per cent. As a result of this development, DigiTimes analysts have decline their sales forecasts for the Chinese market: Instead of previously expect sales figures of up to 36 million units, they now expect the sales volume to be 32 to 35 million units solely.

This incipient decrease in demand might trigger a change as to how panel makers prioritise supply: Despite the role of China as an important market for them they possibly will raise attention towards the established markets of the United States and Europe. According to that, the tense situation concerning supply of LCD panels in this areas will wind down in the next months.

Overall, the panel makers' prospects concerning the further course of the year seem to positive; there is no stop in growth on the horizon. However, it remains to be seen if the industry wide expansions of capacity will be influencing panel prices during the second half of the year. Possible oversupply could lead to an artificial drifting down of prices of LCD panels.

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