May 13, 2021
It may seem odd in the face of stalled economies and stalled AV projects, but the costs of LCD display products are on the rise, according to a report from Digital Supply Chain Consulting, or DSCC.
Demand for LCD products remains strong , says DSCC, at the same time as shortages are deepening for glass substrates and driver integrated circuits. Announcements by the Korean panel makers that they will maintain production of LCDs and delay their planned shutdown of LCD lines has not prevented prices from continuing to rise.
I assume, but absolutely don’t know for sure, that panel pricing that affects the much larger consumer market must have a similar impact on commercial displays, or what researchers seem to term public information displays.
Panel prices increased more than 20% for selected TV sizes in Q3 2020 compared to Q2, and by 27% in Q4 2020 compared to Q3, we now expect that average LCD TV panel prices in Q1 2021 will increase by another 12%.
The first chart shows our latest TV panel price update, with prices increasing across the board from a low in May 2020 to an expected peak in May/June of this year. Last month’s update predicted a peak in February/March. However, our forecast for the peak has been increased and pushed out after AGC reported a major accident at a glass plant in Korea and amid continuing problems with driver IC shortages.
The inflection point for this cycle, the month of the most significant M/M price increases, was passed in September 2020, and the price increases have been slowing down each month since then, but the January increase averaged 4.1%. Prices in February 2021 have reached levels last seen exactly three years ago in February 2018.
Prices increased in Q4 for all sizes of TV panels, with massive percentage increases in sizes from 32” to 55” ranging from 28% to 38%. Prices for 65” and 75” increased at a slower rate, by 19% and 8% respectively, as capacity has continued to increase on those sizes with Gen 10.5 expansions.
Prices for every size of TV panel will increase in Q1 at a slower rate, ranging from 5% for 75” to 16% for 43”, and we now expect that prices will continue to increase in Q2, with the increases ranging from 3% to 6% on a Q/Q basis. We now expect that prices will peak in Q2 and will start to decline in Q3, but the situation remains fluid.
All that said, LCD panels are way less costly, way lighter and slimmer, and generally look way better than the ones being used 10 years ago, so prices is a relative problem.
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