Blog

What risks does China’s power outage spell for the domestic panel manufacturing industry?


2021-09-30 Display TrendForce

The impact on display panel production in China caused by the ongoing power outage has been manageable, although assembly plants in the downstream supply chain and component makers(for metal and plastic parts, for example)in the upstream supply chain have had to suspend operations as a result. Nevertheless, assuming these work stoppages conclude by the end of September, the aforementioned companies in the downstream/upstream supply chains will likely be able to make up for their lost production capacities by issuing overtime work. Hence, the power outage’s impact on their operations is ultimately expected to be rather limited.

In addition, it appears that the power outage will NOT affect the installation of new production capacities at all. However, given that power outages have continually taken place in cities including Guangzhou and Suzhou, attention needs to be paid to whether such power outages become a regular, cyclical occurrence for various cities in the future, especially without prior warning. Frequent, unannounced power outages may pose a challenge to panel manufacturers’ capacity allocation efforts.

(Image credit: Unsplash)