Despite the lackluster third-quarter peak season and stagnant end-user demand, leading Chinese panel manufacturers have announced a two-week production cut during the National Day holiday. This move has shifted some demand forward to September, temporarily easing the price decline of mid-to-small-sized LCD TV panels.
Panel industry insiders anticipate that LCD TV panel prices will hold steady in October, though future pricing trends hinge on sales performance during Single’s Day and the traditional year-end peak season.
Weak demand during the third-quarter peak season has prompted TV manufacturers to make further downward revisions to their forecasts, resulting in steeper declines in LCD TV panel prices in August. Leading Chinese panel makers, including Boe Technology, TCL China Star, and HKC, have responded with plans for production cuts and factory shutdowns during the National Day holiday.
Industry sources indicate that Boe and HKC will shut down their factories before the National Day holiday, with TCL China Star extending its closure beyond the holiday. The two-week production halt will reduce panel supply in late September and early October, advancing their production cut targets.
From June to August, China’s 8.5 and 10.5-generation panel factories operated at around 75% to 80% capacity. Following the planned production cuts, utilization rates at leading manufacturers such as Boe, TCL China Star, and HKC are expected to drop to 50% in October, helping to alleviate panel oversupply and mitigate the downward pressure on prices.
Experts predict that these production cuts will temporarily restore the balance between supply and demand, stabilizing LCD TV panel prices in the short term. However, any potential price increases will depend on negotiations between panel makers and device manufacturers. Sales during China’s Single’s Day, as well as year-end peak seasons in Europe and the US—particularly Black Friday and the holiday season—will also be key factors.
Notably, this large-scale production cut during the National Day holiday marks the second significant production control measure implemented by panel manufacturers in 2024. These controls are expected to become a regular practice moving forward.
Though production cuts help panel manufacturers maintain prices and profits, they have adverse effects on brand companies. With reduced production, brands shift their focus to high-end products, shrinking the overall TV market size and potentially curbing demand. This scenario may require more frequent production cuts, potentially triggering a vicious cycle that the industry must carefully evaluate to avoid.
