Taiwan's panel industry is expected to continue making profits into 2014 after recovering in 2013 following consecutive losses, according to market observers.
Taiwan panel makers such as AU Optronics (AUO), Innolux and Chunghwa Picture Tubes (CPT) saw profits rebound in the third quarter of 2013 following over two years of losses. Improved technologies, adjusted product mixes and product differentiation strategies were all key factors in helping them recover, the observers said.
Additionally, despite fluctuations in shipments and pricing for large-size panels throughout 2013, the makers focused on value-added products and new shipment channels, most notably in China. Demand for large-size panel products used in monitor and notebook products is expected to be limited throughout the beginning of 2014 but will pick up during the Lunar New Year and May 1 holiday periods in China, which will help stabalize profits for the makers in the segment, the observers believe.
The Taiwan makers also expect to see growth in the Ultra HD TV panel segment. The observers said that in 2014 almost 27 million Ultra HD TV panels are expected to be shipped despite market predictions stating that Ultra HD TV shipments will be around 12.7 million. Ultra HD TV shipments reached about 1.9 million in 2013, with most demand coming from China.
Panel makers in Taiwan believe their product differentiation strategies for Ultra HD TV panels will help them land orders from important China-based TV vendors even though China panel makers and Korea panel makers are expected to produce similar-size panels.
Some of those panel sizes include 50-, 55-, 60- and 65-inch units as well as 48- and 49-inch units from China and Korea makers to combat 50-inch panels from Taiwan makers.
Despite the positive outlook for Taiwan panel makers in 2014, the observers believe the year will also be a crucial time for them to bump up their technology and production capacity even more as Korea panel makers improve OLED technology, Japan makers improve LTPS technology, and as China is set to unveil new fabs that will produce a variety of technologies ranging from entry-level to high-end panels.
China is also seeing increased government assistance in terms of funding, which will allow the nation to greatly increase its production capacity to meet panel demand that Taiwan makers would otherwise meet.
Ultra HD TV panel shipments will be crucial for Taiwan panel makers in 2014
Photo: Michael Lee, Digitimes, January 2014
Article translated by Alex Wolfgram
