According to the latest July 2014 large-size panel shipment report from WitsView, the display research department of the global market research organization TrendForce, global large-size panel shipments totaled 68.21 million units in July, a month-on-month decrease of 5%.The demand for TV panels remained strong in July. LCD TV panel shipments reached 20.86 million units, a slight month-on-month decrease of 0.4%. Monitor panel shipments, however, were impacted by capacity allocation towards TV products, with total shipments falling to 12.72 million units, a month-on-month decrease of 5.6%. Furthermore, due to rising demand for smart portable devices, notebook PC panel production continued to be constrained, leading to total July shipments of 15.32 million units, down 5.8% month-on-month. The tablet panel market was affected by Apple's inventory adjustments for older models in preparation for the launch of a new 9.7-inch tablet in the second half of the year, resulting in total tablet panel shipments of 19.27 million units, an 8.4% decrease from June.WitsView senior research manager Allen Chu estimates that global large-size panel shipment volume in August will be similar to July's level. While the number of TV panels shipped is not expected to change significantly, the total shipment area will continue to increase. IT panel supply, however, will be reduced due to competition from mobile devices like phones. Monitor panel shipments are forecast to decline by 1-2%, notebook panel shipments are expected to remain flat compared to July, and tablet panel shipments are projected to decrease by about 1% month-on-month.Allen Chu further pointed out that in recent years, the rise of mobile devices like tablets and large-size smartphones has suppressed the expansion of the traditional IT market. Considering profitability and production efficiency, panel makers are increasingly using larger-generation fabs to produce small-to-medium sized panels for smartphones and tablets, aiming to create greater economies of scale and compete for the relatively more profitable mobile device panel market. Taking Samsung as an example, the company is leveraging the strength of its entire group to actively compete with Apple for the top position in the tablet market. Its subsidiary, Samsung Display, has significantly adjusted its Gen 5 fab strategy, reducing notebook panel products and increasing the proportion of mobile device panels. LG Display has also begun increasing the production share of smartphone and industrial control products in its Gen 5 and Gen 6 fabs. In the second half of 2014, due to high demand for smartphone panels from Apple and other major Chinese clients, LG Display's notebook panel output is expected to decline further. The shift in production strategy by Korean manufacturers in their Gen 5 and Gen 6 fabs is not only causing fluctuations in the supply and demand of the notebook panel market but is also leading major notebook brands to shift orders to Taiwanese and Chinese panel makers.Among the beneficiaries of this order shift, Innolux (a Taiwanese manufacturer) has gained the most. Relying on its unique 5.5-generation production lines for mainstream 14-inch notebook products, coupled with continuous improvements in the cost structure of panels across various sizes, and relatively flexible panel pricing and delivery volumes, Innolux has gained favor from various brand clients. Consequently, its market share in notebook panel shipments continues to expand. Meanwhile, BOE (Beijing Oriental Electronics), supported by ample 8.5-generation line capacity, is actively allocating production plans for mainstream products like 14-inch and 15.6-inch panels, which has also attracted attention from brand clients and successfully strengthened its cooperative relationships with them.Through nearly a year of effort, Innolux has continuously increased its notebook panel shipment volume, successively surpassing Samsung and AUO (AU Optronics). In July, its single-month shipments even surpassed those of LG Display. With a remarkable market share of 27%, Innolux has become the leader in the notebook panel market. This also drives the combined market share of Taiwanese manufacturers in notebook panels ever higher. According to WitsView statistics, the notebook panel market share ratio between Taiwanese and Korean manufacturers was 45%:48% in Q4 2013. By Q1 2014, Taiwanese manufacturers surpassed Korean manufacturers for the first time, achieving a ratio of 48%:45%. In Q2 2014, Taiwanese manufacturers maintained their leading position with a market share ratio of 46%:45%.Source: International Electronics Business (ESM)
