TV sales in China hit their peak in 2019, with 44.5 million units sold, but the market experienced a sharp decline in 2020. This was due to the previous marketing strategy of lowering prices to increase sales volume no longer being effective for small and medium-sized products. In response, brands shifted their focus to larger-sized products, specifically those with a screen size of 65 inches or above, which has accelerated the trend of larger TVs dominating the market.

Panel prices skyrocketed between 2020 and 2021, causing a significant price disparity for TV products during promotional events in China. In the 2021 618 promotion, 55-inch TV prices surged by 67% compared to the previous year, while 65-inch TVs increased by 50%, leading to a surge in demand for larger TV sizes. TVs with a screen size of 55 inches and above accounted for over 65% of the market share in China in 2021, and it is anticipated to reach 80% by 2022. With greater discounts, 65-inch TVs became the mainstream size in 2022, surpassing 55-inch TVs in sales volume and market share. The market share of smaller TVs (43 inches and below) fell from roughly 30% to 16%.

According to recent market research, the dominance of smart TVs has surged from 85% in 2016 to a staggering 98% in 2022. Additionally, the popularity of 4K TVs has risen rapidly, with an 80% market share in 2022, following their introduction in 2014. The shift towards these new TV standards has been fueled by ongoing price cuts in the retail sector and the growing demand for larger screen sizes.

The scale of promotions during China’s 618 and Double Eleven shopping festivals could be affected by the upward trend of larger screen sizes and the rise in panel prices in 2023. As a result, brands are expected to shift their promotional strategies towards larger TVs, particularly 75-inch and 85-inch models, which generate more revenue. Consequently, TV sales in China for this year are predicted to decline further by 1.7%, with an estimated sales volume of approximately 30 million units.v

According to TrendForce’s latest panel price analysis, due to the low inventory level of panel manufacturers and the strategy of maintaining production regulation, the overall supply and demand of TV panels have reached balance. With the strengthening of the stocking momentum for TV panels in China, the price increase trend of TV panels in April can still continue, but the price difference between first-tier and second-tier brand customers is relatively large.

Second-tier brand customers mostly can only accept the price increase of the panel manufacturers, while first-tier brand customers still have a certain degree of bargaining space. Looking at the TV panel prices in April, all sizes have maintained an upward trend, with 32 inches expected to increase by 1USD, 43 inches by 3USD, 50 inches by 6 USD, 55 inches by 7~8 USD, 65 inches by 13USD, and 75 inches by 10~11 USD. With this price increase trend, TV panel prices may have a chance to return to the cash cost level in May.

After the monitor panel prices stabilized in March, there are currently signs of strengthening demand for some consumer models, including high-end gaming monitors and some entry-level affordable ones. This is partly due to downstream customers replenishing inventory demand, and also preparing for the upcoming 618 promotion in China. Therefore, it is expected that the full-size monitor panel prices in April will remain stable.

Turning to notebook panel, Chromebook demand has rebounded in Q2, but other mainstream models are still affected by brand customers’ inventory destocking, leading to no clear increase yet. Therefore, notebook panel prices in April are expected to remain stable, with potential for increase depending on the timing of inventory destocking and demand momentum.

According to TrendForce investigations, global TV shipments will reach 47.26 million units in 1Q22, down 20% QoQ. Driven primarily by the Russian-Ukrainian war, prices of raw materials such as crude oil and natural gas have risen, while the recent breakout of the Omicron strain of the pandemic in China has incited repeated no warning attempts at enacting dynamic zero-COVID, which has hindered the flow of logistics, hiked freight rates, and taken as a whole, exacerbated existing global inflation woes. Consumers with limited disposable income have started to cut back on non-essentials with TV sales bearing the brunt. Looking at the three major TV sales regions of North America, Europe, and China in 1Q22, high inflation in Europe and the United States has led to a sharp 20% drop in demand. In China, due the festering pandemic, numerous cities have been locked down, while unemployment is spiking, logistics are impeded, and prices soar. TV product sales are at a complete disadvantage and the demand in 1Q22 dropped by 15~20%.

TrendForce further points out, originally Chinese brands banked on low 2Q22 panel prices and not being required to shoulder expensive shipping costs in the domestic market, expecting that the 618 anniversary promotional period would inject fresh enthusiasm into the market and boost annual shipments. However, now that China’s TV sales are disrupted by the pandemic, any hope riding on TV brands’ only large-scale promotional event in the first half of the year may have been dashed. In addition, Q3 was when brands stocked up in previous years for Black Friday and Christmas season promotions in Europe and the United States. However, this year’s FIFA World Cup was postponed to November, resulting in overlapping promotional schedules, which may curb sales. Ocean freight remains expensive this year, with additional costs increasing with greater item size, which is not conducive to the rollout of branded manufacturers’ large-scale promotional activities in 2H22. Therefore, TrendForce estimates that this year’s TV shipments will drop further to 212 million units, for an annual growth of only 1%, and there exists additional potential for downward risk.

Demand in Europe and US misses estimates, international brands drop orders, and 2Q22 decline in TV panel prices expands further

The top two leading TV brands, Samsung and LG Electronics, are mainly sold in North America and Europe. Therefore, since TV sales in Europe and the United States declined by 20% in 1Q22, this had the greatest impact on these two leading brands. Samsung Electronics shipped 10.9 million TVs in 1Q22, down 3.1% QoQ while LG Electronics shipped 6.53 million TVs in 1Q22, down 11.8% QoQ and down 6.4% YoY. Affected by weak terminal demand, the two major brands revised their panel purchase orders in late March. Samsung’s purchasing volume in 1Q22 was revised down 7.5% and fell by 9.5% in 2Q22. LG Electronics primarily focused on reducing purchase orders in 2Q22 and purchasing volume decline is expected to exceed 20%.

TrendForce specifically states, major international manufacturers have recently revised their orders in succession. Although Chinese brands have yet to see a significant reduction in orders, if 618 promotions are disappointing, it cannot be ruled out panel procurements will begin to fall in mid-to-late Q2. Although branded manufacturers significantly revised TV panel orders downward in 2Q22, panel manufacturers have not seen a significant reduction in utilization rate, which will depress the price of panels below 55 inches (inclusive) in a sustained freefall while the prices of large size panels above 65 inches (inclusive) will continue to deteriorate.

Samsung Electronics delays launch of WOLEDs, styming 2022 OLED TV shipment performance

This year, the supply of OLED TV panels has benefited from LG Display’s expanded production capacity of 8.5-generation OLED TVs in Guangzhou. As supply increased, LG Display also improved product specifications and prices, but this led to Samsung Electronics delaying the verification and launch schedule of white OLED products. Not only has Samsung Electronics’ 2022 market share of OLED TVs shrunk from 15% at the beginning of the year to 6.4%, but global OLED TV shipments will be revised down to 7.79 million units this year, with an annual growth rate of 17%.

TV shipment performance in 2022 will return to a pre-pandemic cycle but the Russian-Ukrainian war has indirectly led to rising inflation. With consumer spending unchanged, expenditures on non-essentials are bound to feel the squeeze. Russia accounts for 82% of TV shipments in the CIS (Commonwealth of Independent States) region and Ukraine also maintains a 12% market share. As the war drags on, the region will bleed 1.5 to 2 million TV sets in the short term, and TV shipments may fall by more than 3 million sets in the medium term. Although demand in the CIS region is not positive, Southeast Asia and emerging markets were severely affected by the COVID-19 pandemic in 2021, deferring a portion of demand. Overall, TV shipments in 2022 will adjust downward to 215 million units, or 2.4% YoY and a decrease of 0.7% from the previous 2022 forecast.

According to TrendForce statistics, TV shipments in the CIS region account for 4% of the global total, of which 60% consists of 32-inch and 43-inch models. The two major TV brands, Samsung and LG, account for nearly 50% of the combined market in the CIS region. At present, due to factors such as geopolitics and economic sanctions, shipments to Russian factories for back-end TV assembly have been halted and Samsung has gone one step further by halting sales.

Samsung and LGE account for more than 50% of CIS region market share, hardest hit by the Russian-Ukrainian war

Russian demand for TV sets falls at 6-7 million units per year. Due to high tariffs, TV giants Samsung and LGE have been encouraged to set up TV assembly plants in Russia which, not only reduce tariff costs, but also enjoy the benefits of zero-tariff exports to Ukraine.

Samsung and LGE originally sent imports from South Korea to Russia in the form of CKD (Complete knock down) in order to assemble TV sets in local factories and enjoy duty-free benefits. However, the war has suspended all shipments to Russia.

It is worth mentioning, as damage has been dealt to the two Korean brands, Chinese brand Haier has chosen to accelerate its deployment in the Russian market. Haier is expected to successfully occupy third place in TV sales in the CIS region with a market share of 11% in 2022. In 2021 Haier’s shipments in the CIS region reached 800,000 units. In 2022, it has an opportunity to cannibalize lost market share from Korean brands with a shipment target of one million units. Judging from the TV production capacity of local factories, volume maxes out at 2 million units. Haier is forecast to become the biggest winner of the Russian-Ukrainian war.

Soaring shipping costs portend possible further downgrade of 2022 TV shipments

Due to factors such as reduced shipments and inventory control, the two Korean brands have gradually adjusted their purchase volume of TV panels in the near term, relegating 32- and 43-inch TV panels, units that had an opportunity to increase in price in April 2022, to a downward price trend again. Due to falling demand for TVs and IT, concerns over panel overcapacity are overwhelming and some panel manufacturers have decided to begin gradual capacity adjustment in April 2022.

Of the challenges plaguing the TV market in 2022, in addition to the existing problem of the COVID-19 pandemic, the Russian-Ukrainian war and rising global inflation also add variables to demand. In addition, cargo container shortages and port congestion increased shipping costs significantly in 2021, indirectly inflating the cost of TV sets with costs rising as TV sizes grow. Even though current panel pricing has dropped by 30% to 40% compared with its high point in 2021, no expected reduction in freight costs in 2022 will inevitably affect the scale of branded promotions and stocking during the peak season of overseas markets in 2H22. Therefore, there is still room for TV shipments in 2022 to be revised downward.

（Image credit: iStock）

The shipment performance of TV brands in 1H21 benefited from COVID-19 economic relief funds in the U.S., driving a continuing boom in North American shipments, according to TrendForce’s investigations. At the same time, TV brands continued to replenish panel inventories, pushing up panel prices. As the pandemic slowed down in Europe and the United States in 2H21, life returned to normal and pandemic stimulus no longer applied, challenging demand levels. In addition, rising raw material and freight prices pushed up whole device cost, forcing TV brands to pass costs onto retail pricing. Even though TV brands staked their hopes on the two major annual yearend sales promotion events of Singles Day in China (the biggest shopping day of the year globally, online and IRL) and Black Friday, sales performance was poor due to high costs leading to a slump in end-user demand and eventually causing TV shipments to decline by 3.2% annually to 210 million units in 2021.

TrendForce further indicates that panel supply and overall production capacity will be ample in 2022, dispelling severe TV panel price fluctuations while ushering in steady and moderate fluctuations as a replacement. After a sharp revision in TV panel prices in the 2H21, this year’s panel pricing is more advantageous to the planning of TV brands. In addition, the severe impact of the pandemic in Southeast Asia and emerging markets and high panel prices last year caused TV brands to reduce the scale of small-sized 23.6-inch, 32-inch, and 43-inch products, forcing a deferral of demand. In 2022, the pricing of small-sized panels will be close to panel manufacturers’ cash cost which will help TV brands recapture a larger proportion of small-sized panel shipments. The proportion of shipments below 39-inch will remain at 25%, medium-sized 40~59-inch panels will remain at 55%, and large-sized panels above 60-inch will remain the focus of international brands with market share expected to rise to 20%. Benefiting from the deferral of small-sized panel demand, TV shipments in 2022 will grow by 3.4% to 217 million units.

OLED TV growth to slow down in 2022, annual growth rate to settle at 27%

In 2021, OLED TVs benefited from soaring LCD prices in the previous two years. This was also the case with 55-inch 4K O/C products. The price difference between the two has narrowed from a multiple of 4.7 in early 2020 to 1.8 in mid-2021, thereby incentivizing more TV brands to switch to producing OLED TVs when LCD panel supply is limited and driving OLED TV shipments to 6.7 million units in 2021, or 70% growth YoY. Although Samsung Electronics intends to join the white OLED camp and simultaneously launch QD OLED TVs this year, the continuing falling pricing of LCD panels and the price of OLED TV panels (subject to LG Display’s strategy of increasing pricing as opposed to dropping them) may disrupt Samsung Electronics’ rollout of OLED TVs. If Samsung Electronics fails to launch spring OLED TV models, its original shipment target of 1.5 million units will inevitably be affected. However, whether it launches OLED TV models in spring or summer, Samsung Electronics will take advantage of its brand and channel advantages irrespective of other considerations to take the OLED TV market by storm and aim for a market share of 15%.

Annual growth rate of Mini LED TVs doubled, shipments push towards 4.5 million units

TCL has opened up new horizons for TV products after releasing its first Mini LED TV in 2020. In 2021, Samsung Electronics launched a series of 50-85-inch mid/high-end 4K and flagship 55-85-inch 8K Mini LED models, with shipments exceeding one million units in the first year, reaching 1.5 million units, and boosting overall Mini LED TV shipments in 2021 to 2.1 million units. In addition to Samsung Electronics and TCL continuing to utilize Mini LED in 2022, more TV brands will also join the fray. Overall Mini LED TV shipments will race towards 4.5 million units. SONY showed its 8K 85-inch and 75-inch TVs for the first time at CES at the beginning of the year. Sony’s flagship 4K 85-inch, 75-inch, and 65-inch models were the most notable at CES and Sony will join Samsung and LG Electronics as another international brand marketing OLED and Mini LED TVs, intensifying competition in the high-end TV market.