Japanese Quake Had Minimal Impact On Declining LCD TV Panel Prices

Jonathan Sutton

When the earthquake and ensuing tsunami devastated the north-east part of Japan last month, certain analysts raised concerns about some potential disruptions to the LCD TV supply chain due to material shortages, which may in turn lead to temporary LCD panel price increases. However, a new report from a leading market research company has allayed those fears (at least for the moment).

Japan earthquake and tsunami

According to California-headquartered firm IHS iSuppli, pricing for large-sized LCD television panels is expected to decline slightly in April, suggesting that any disruptions have been kept to a minimum despite the scale of the Japanese earthquake and tsunami disaster. More specifically, a 0.8% drop in prices is projected for LCD TV panels, compared to rises to the tune of 0.2% and 0.4% for laptop and TFT monitor panels respectively.

This perpetuates a trend of price decreases for LCD TVs since the turn of the year, largely caused by sluggish sales in developed American and European markets, as well as cautious inventory replenishment in China. As supply of TV panels is currently still higher than consumer demand, it’s hardly surprising for iSuppli to predict another month of marginal price decline.

Stacy Wu, an IHS display research senior analyst, tried to explain why supply disruptions were minimal in spite of the quake. Even though there were early suggestions that shortages in several key materials produced mostly by Japanese companies might hold up the manufacturing of LCD screens, it turned out that TV panel makers have been stocking around four to six weeks’ worth of inventory, hence staving off any production delays.

Also, many assembly plants in Japan are now back up and running (after being shut down in the aftermath of the earthquake/ tsunami), which keeps the supply line flowing. Looking ahead though, some LCD panel makers have expressed fears that the protracted power outages and nuclear crisis engulfing Japan at present will hurt future demand for HDTV displays.