With rumors indicating that Samsung Electronics and LG Display have both received approval from the Chinese government for their advanced production plant projects, Taiwan's LCD panel makers believe that they will not be far behind, and the next battleground for the global top-four panel makers will be in China.
Taiwan, following Korea's decision, has allowed its panel makers to invest in China. Local makers said that the Taiwan government will speed up the review of an application by AU Optronics (AUO) to construct a 7.5G plant in China.
In China, two local players - TCL's subsidiary China Star OptoELectronics Technology (CSOT) and BOE Technology - are both expected to start production at their 8.5G plants in the second half of 2011,
Production ramp-up at Samsung's and LG's plants in China are expected to delay about six months, as the approval of the projects took six months longer than expected. Samsung originally planned to start production at its China plant in the third quarter of 2011, and LG's original plant was to start volume production at the beginning of 2012. Based on the schedules, significant oversupply is expected in 2012-2013.
It is understandable why global major panel makers are competing in the China market. According to DisplaySearch's estimation, the China TV market is expected to increase over 30% to 46 million units in 2010, of which there will be 39 million LCD TVs, 1.65 million PDP models and 4.5 million CRT sets. In 2011 the China TV market is expected to increase 9% to 49 million units, with LCD TVs rising to 46 million units and PDP TVs to 1.8 million units. But CRT TV shipments will drop to 1.5 million units.
Previous forecasts indicated that China would not become the largest LCD TV market worldwide until 2011. However, LCD TV shipments to the Western Europe market are expected to reach about 39 million units in 2010, similar to the volume shipped to China. Sales in the North America market have been worse than expected and will reach only 38 million this year, giving China an opportunity to become the largest LCD TV market in 2010, DisplaySearch data showed.