Branded TV vendors have recently stepped up their procurements of LCD panels amid a growing concern that panel prices will likely continue to rise due to the approach of the traditional peak season in the third quarter.
The aggressive purchasing has pushed the overall panel procurement volume back to high levels seen previously and may lead to an early overdraft of demand that should come in the fourth quarter, according to industry sources.
The sources noted that the cumulative price increases for various sizes of LCD TV panels have already exceeded 20% since March, thanks to tight production controls at panel makers, expecting the price spiral to continue in July.
According to data compiled by China-based AVC Revo, total TV panels purchased by the world's top 11 TV brands reached 49.5 million units in the third quarter, the highest quarterly volume in the latest two years.
The high purchasing volume comes even though the TV sales during this year's 618 shopping festival were not impressive. Besides, TV shipments in China remain weak in 2023, likely to slide below 35 million units, which will be lower than the amount shipped a year earlier.
Due to a slow economic recovery worldwide and inflation concerns, global TV shipments will also suffer a decline in 2023, reaching below 200 million units, the sources estimated.
With end-market demand remaining in the doldrums, the sources said TV vendors' panel procurement for the third quarter was rather aggressive, and some brands, except for Samsung, have seen their inventory levels rise.
AVE Revo's data showed that Samsung Electronics maintained an inventory level of 14 weeks at the end of June, a significant decrease compared to a year ago, noting that Samsung has a large inventory scale, allowing it greater control over adjustments.
On the other hand, companies like LG Electronics and Hisense have been excessively purchasing panels during most of 2023, resulting in a continuous rise of their inventories, each exceeding 10 weeks.
To pass the increased panel prices on to consumers, some Chinese TV brands, including Konka, TCL, Changhong Electric, Hisense, and Skyworth, recently raised their TV product prices, ranging from 5-30%, depending on models and sizes.
Article translated by Steve Shen
