Chinese display makers BOE, TCL China Star Optoelectronics Technology (TCL CSOT) and HKC Display Technology have sent customers notices of higher LCD panel prices. According to South Korean outlet The Elec, the letters went to major TV brands including Samsung Electronics, LG Electronics and Sony, just as they gear up for the holiday sales season.
The timing varies by supplier. BOE will roll out the new prices in the fourth quarter, while TCL CSOT and HKC will start raising prices on some products as early as September.
For buyers, it lands right in the middle of the purchasing cycle. From August or September, Samsung, LG and other TV makers typically stock up on components and ramp up production ahead of Black Friday and Christmas. That leaves them little room to cut back on LCD panel orders now.
There is no noticeable shortage of panels, either. Industry estimates put utilization at some Chinese LCD lines at only around 70%. Yet instead of running those lines harder and flooding the market, the manufacturers are holding output back. That keeps a glut from forming and props up current prices.
Follow Mediasat on Google News: the latest in TV, telecom and tech
China’s grip on the market is what makes this possible. Research firm Omdia says BOE, TCL CSOT and HKC have effectively split the market for large TV-sized LCD panels between them, forming an oligopoly. The leading Chinese makers together hold 70% to 85% of the market for 65-, 75- and 85-inch panels. In even larger sizes, Chinese companies control almost the entire market.
They got there by expanding capacity aggressively and selling panels cheaply. The resulting oversupply drove prices down, and South Korean and Japanese companies began exiting the less profitable parts of the business. Samsung Display stopped making LCD panels in 2022. LG Display halted TV LCD panel production in South Korea and later sold its plant in Guangzhou, China.
Chinese companies are scaling up beyond panels, too. TCL, for one, is building the world’s largest TV factory in China. It is also taking on Samsung directly: TCL recently sued Samsung over how it markets some of its budget TVs.
