TV manufacturers slash production as demand falls -

The LCD TV industry, driven by reduced inventories and strong Q4 sales, had plans for a strong 2011.

However, the positivity only lingered for a short while, with DisplaySearch now reporting that many LCD TV brands have now adjusted their Q1’11 production plans downward.

The top 16 LCD TV brands, including the likes of Samsung and regional players Konka in China, have reduced their combined monthly production plan from 18.3 million in November 2010 to 15.4 million units in March 2011. DisplaySearch said this now meant that predicted shipments stood at 46.3 million units, a 12 percent decline from Q4 last year.

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Deborah Yang, Research Director of Monitor and TV for DisplaySearch, said: “The unstable market environment in many regions is creating uncertainty regarding TV demand. Despite this, some TV brands reportedly are increasing production quantities in January 2011 because of demand anticipated from Q1 product launches."

However, it's not all doom and gloom, with the analyst company claiming that despite the cautious stance of the TV brands, LCD TV sub-contract manufacturing companies are increasing their monthly shipments from December 2010 to March 2011. It said this hinted that TV brands were increasing outsourcing manufacturing to OEM/ODM companies, which is driven by cost management, logistics, manufacturing scale, and in some cases, access to panel supply.

When it comes to components DisplaySearch also added that the supply of key TFT LCD panel components, such as glass substrates, colour filters, polarizers, LED and light guide plates was in balance in the first quarter of this year.

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However it warned that January large-area TFT LCD panel shipments will fall 2 percent from December 2010, due to adjustments in capacity utilisation rates, and decline a further 7 percent M/M in February due to fewer working days in China. However, panel makers expect a big jump in March, with shipments passing 60 million units.

LCD TV panel shipments to China were 5.1 million units in November, and fell to 5.0 million units in December. DisplaySearch forecast shipments would continue to fall to 4.6 million in January and 3.2 million units in February.