2011 has been a challenging year for the TV industry. Sluggish consumer demand in developed regions, like North America, Japan and Western Europe, has led to poor profitability on the part of TV set makers and panel makers. With supply chain inventory problems persisting well into mid-year, many TV brands cut back on their shipment plans for 2011 and reduced panel orders in Q3, which resulted in larger price declines for those core panels. The upside for consumers is more attractive retail set prices during the upcoming holiday season, particularly during Black Friday in the U.S.
“End-market demand has been weak in North America during most of 2011, with unit shipments falling around 4% Y/Y through the first three quarters of the year,” noted Paul Gagnon, Director of North America TV Research, DisplaySearch. “However, consumers, still quite sensitive to pricing, may be delaying purchases until the holidays when they expect to see the best deals. Consumers have learned this practice from observing previous holiday selling periods.”
According to the latest figures published in the DisplaySearch Advanced Quarterly Global TV Shipment and Forecast Report, total TV market shipments were up 3.7% Y/Y in Q3’11 to 62M units, a 12% increase from Q2’11. This marks a healthy rebound from the 1% Y/Y shipment decline in Q2’11 and weak 1% Y/Y gain in Q1. However, orders for LCD and plasma panels used in the production of TV sets were both down in Q3’11, resulting in a somewhat lean inventory situation towards the end of the quarter. Many suppliers have taken a conservative approach to inventory for the holidays. Therefore, if demand is better than expected, there may not be much slack in the supply chain to fulfill restocking orders. This could potentially lead to some product shortages.