AU Optronics (AUO) and Chimei Innolux (CMI) may each suffer losses estimated at NT$10 billion (US$342 million) for the third quarter 2011 due of falling prices for large-size LCD TV panels and weak demand, with little chance of returning to profitability in the fourth quarter, according to industry sources.

CMI has remained in the red since third-quarter 2010, accumulating losses totaling NT$55 billion. AUO has suffered losses for three consecutive quarters, with accumulated losses of NT$36 billion from fourth-quarter 2010 to second-quarter 2011.

Prices of the mainstream 32-inch TV panels have reached cash cost levels, declining to US$127 in October from US$132 in September, according to DisplaySearch. Quotes for other large-size TFT-LCD panels have also continued to drop in October, the research firm said.

The sources said LCD TV sales during China's long National Day holiday in October have been flat. Panel makers have already started talks with China TV clients over orders for the year-end and Chinese New Year shopping seasons, which they hope can see stronger demand, the sources added.

Shipments of TV panels have dropped for three consecutive months since June 2011, compared with the same months of 2010. The sources cited the weaker-than-expected TV sales during China's October holiday and the fact that China only accounts for 20% of world's TV shipments.

Source:digitimes