On February 22, according to the latest data from research group Qunzhi Consultation, the overall demand for TV panels in February was weak, but the stock of large-size, especially UHD (Ultra-HD) panels remained strong. This means that this time the price increase will focus on large-size high-end products, industry forecasts, manufacturers will collectively rise in early March.
Take Xiaomi TV as an example. Since 2017, prices have been raised three times. The latest price increase was announced on February 11th. Millet TV's 3s60-inch and 65-inch theaters were upgraded to 4799 yuan and 6,699 yuan respectively, up by 300 yuan and 700 yuan respectively; on February 8th and early January, 3s and 48th. 55 points have been raised, both have accumulated a total of 600 yuan and 500 yuan. Among them, the 48-inch increase was as high as 30%, and the rest of the increase was over 5%.
Reasons for price increases are concentrated on the rise of the cost of major components such as panels and exchange rate fluctuations. While panel makers are positive, brand makers are still faced with the challenges of supply and demand fluctuations and profitability problems.
Structural price increase of panel
The screen that occupies more than half of the cost of the TV determines the trend of the product price. The panel price has gone all the way and the color TV market price has to rise again.
TCL Guangzhou sales department management told the 21st Century Business Herald reporter: “At present, we have not received notification of price hikes from the headquarters. According to market conditions, we will see another rise in the near future, because the screen, personnel, transportation, raw materials and other expenses are rising. Among them, the small-sized panel has gained more than the large size in the early stage, and now the demand for large-size panels has increased. This time, the price increase will at least keep up with the panel gains."
Another TCL sales department official told reporters, "TCL TV years ago, the average rose 300 yuan, price increases again expected to rise about 300 yuan on this basis."
This message has also received feedback in terminal shops. The color TV sales staff at Guangzhou Suning Yik Kecun Store told the reporter that some color TV products will begin to rise in price in March. The small sizes such as 32-inch and 43-inch increase were larger. Now, large-size TVs will soon rise. Reporters visited the Guangzhou City, a number of stores found that 32-inch TV prices are already more than 1,000 yuan, more promotional activities for large-size TV, the price will remain at the level of years ago.
“The panel price hikes are structural, 65-inch and some UHD products may continue to rise next month, the current size of the small size is stable.†Li Yaqin, deputy general manager of Quzhi Consulting, told 21st Century Business Herald reporter.
According to Sigmaintell's survey data, the price of 32-inch panel was maintained because the entire machine manufacturers made difficult profits to reduce demand, while panel makers continued to reduce output, and the market supply and demand tended to balance; SDC (Samsung Display Co., Ltd.) ) 7th-generation line closure and SDP (å º Panel Plant) panel supply disruption, 40-inch actual supply capacity has been greatly reduced, manufacturers have turned to larger size panels.
In terms of large size, the 49-inch panel was affected by the production cost factor, and the manufacturer's planning was not positive, while 50-inch capacity was excluded by the 75-inch capacity in the G7.5 generation line. Innolux G8.6 generation line had not yet achieved mass production, and supply and demand remained tight. The 65-unit price rose the most in February, and the unit price rose by US$10. Taking into account the profitability and supply factors, brand manufacturers are still active in stockpiling large-size products, but production capacity is limited and price growth continues.
Despite the cyclical nature of the panel industry, the surge in prices at this time is still beyond the expectation of practitioners. According to Wang Zhiguo, chairman of Skyworth's cool open company, the panel price hike has already approached the ceiling. “On the market, regardless of the size, the increase of TV is about 10%. Cool open will raise the price next, we are still measuring, The price of the current panel is already very close to the price we set."
Internet TV challenge is largest
In the tide of price hikes of TVs, Internet brands took the lead. In February, the price of two-time millet was very aggressive. Also reflected from the side of the pressure of the business, the original Internet brands hit the market at a low price to be affected.
“Our tolerance for price increases will be a bit bigger, because backing Skyworth can share the panel’s resource reserves and have a certain reaction time, but the profits will certainly be affected. This year's price increase is too surprising, from the small size to the large size, There is still no stoppage trend,†Wang Zhiguo told the 21st Century Business Herald reporter. “This year's internet brands are dangerously profitable. We have also lost money and lost a lot. The current environment poses a huge challenge to business because of the expense ratio. Without a drop, the profit margin has already begun to drop sharply."
Li Yaqin also pointed out that not only has the panel price continued to rise, storage devices have also risen. Under the pressure of rising overall material costs, low-price competition is difficult to maintain. Not only is the Internet brand, but in the case of higher costs, traditional manufacturers also have pressure.
Li Yaqin said: “The biggest problem is that almost all of the entire plant are facing very large pressures on profitability, and the operating situation of the color TV industry is still very severe. In addition, after the price increase, the follow-up demand is not so optimistic, we expect this year China's market is negative growth. Globally, because the US dollar has been a strong appreciation, although the recent stability, but after the appreciation of the demand for emerging countries is inhibited."
TV industry downturn will be apparent from the leading company earnings, net profit growth in recent years, remains the only Hisense and Skyworth, more companies fluctuated between positive and negative.
In addition to the pressure on profits, Wang Zhiguo believes that the price increase of TVs has also brought about two impacts. “First of all, it makes prices rational. When Internet brands enter the market at a low price, they will have a budget for losses, and now they have exceeded the budget to increase prices. There will be a certain amount of sales inhibition, and the market will be stable. On the other hand, for the manufacturers, the product structure will be optimized and changed, going to large size and high-end, compared to large-size anti-risk capabilities Stronger."
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