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LCD-Panel Shortfall Boosts Prices

Shortfalls in LCD panel production are causing LCD TV and monitor prices to inch up, after having fallen to new lows during the past year, according to the research firm iSuppli.

The price increase is a result of a classic case of supply outstripping demand, said Sweta Dash, director of LCD and projection research for iSuppli/Stanford Resources, Santa Clara, Calif.

“A lot of new manufacturers are entering the LCD-TV market right now, including PC makers, and they are ordering huge numbers of panels from LCD suppliers. This is making the present shortfall even worse,” said Dash.

Larger sized LCD rose up to 3 percent in October and another 2 percent was expected to take place in November, she said. Particular pricing pressure is being placed on 15-incn and 17-inch LCDs because of the greatly increased demand for large screen LCD TVs and the fact that demand has not dropped for LCD PC monitors and has increased dramatically for notebook computers.

Dash is not expecting the supply situation to correct itself until mid-2004. However, this timetable could be disrupted if LCD-TV demand heats up even further. Right now iSuppli is forecasting LCD-TV panel shipments to roughly double in 2004, rising close to 8 million units.