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Sony TV Shortage To Be Met In 60 Days

5/03/2010 12:01:00 AM Eastern
SAN DIEGO — Sony Electronics is on course to deliver its new 3D TV lines this summer as scheduled, but executive VP and chief marketing officer Mike Fasulo told TWICE the company has experienced product shortages due to unexpectedly high demand.

In fact, he said, the compounding rate of demand for 2D models that have shipped so far has left the company hard pressed to fill dealers’ revised orders, which should be caught up in 60 days.

“We put in a pretty aggressive forecast for this new line. It’s a brand-new line that we are shipping into the market, and we expected it to be well accepted, but we didn’t expect the unprecedented demand we have seen so far, especially coming off the economy we saw last year,” Fasulo said. “We put in a doubledigit forecast [increase] for this new line, and in 30 days it increased again by another 30 percent.”

According to retailers who spoke to TWICE, the situation is not unique to Sony. Dealers are also reporting TV shortages across the board, with LED LCD TV, 3D TVs of all types, plasma TV (particularly entry 720p models) and 32-inch LCD particularly hot segments.

Asked what he attributes the extraordinary rate of demand to, Fasulo said: “First and foremost I think it’s the new televisions we are bringing to market. They are gorgeously designed whether on or off, they include Internet connectivity, and there is great anticipation for 3D coming out. On top of that, too, I think the economy itself is improving.”

He added that while he welcomes the strong demand for a new line, he worries “about what that will mean with our relationship with our retailers as well as any pain consumers may encounter from that.”

Sony, he said, will be looking to allocate its supply fairly to its dealers and consumers.

“Preference would be with the consumer experience. What I am worried about is we have a very loyal group of dealers and a very loyal group of customers, and how do we get through this with the least amount of pain as possible?” he said.

Sony, he added, is doing its best to communicate with retailers as frequently as possible with updates about any improvement with supply and shipment ETAs.

Hundreds of thousands of units are shipping now, and Sony should start catching up with the demand forecast within the next 60 days, Fasulo said.

“Frankly, some [Sony dealers] are less pleased than others,” he said. “We understand that and respect that. This is their livelihood, but we are doing everything we can to get them better supply and education.”

Fasulo said Sony’s consumer following has shown strong support for the new TV models “across the board. The LEDbased products are some of the highest demanded models right now, but I haven’t shipped 3D yet, and I’m stepping up my orders on 3D now because I’m anticipating demand is going to carry over into our 3D products when they ship.”

Fasulo said Sony deliberately set a summer delivery date for the 3D products, because the company felt it was an important technological opportunity for the company and wanted to ensure that the product was right when models finally hit the market.

Although rumors have circulated among dealers at recent buying group meetings that the lack of supply could stem from Sony’s joint production relationship with Sharp in the new 10th- Gen LCD panel plant in Saiki City, Japan, Fasulo said: “We haven’t encountered supply issues with any of our partners. It has really been a whole demand forecast issue. We thought the forecast was adequate, and we’re seeing well above that.”

Coincidentally, Sharp within the last two weeks said it soon would be doubling the output capacity of the plant.
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