Due to the slow recovery of the global market, especially the sluggish demand in the Chinese market, the decline in profit margins in the North American market, and the fact that LCD panel sales in the third quarter of 2024 were lower than expected, LCD panel manufacturers have stockpiled a large amount of inventory. To mitigate this inventory buildup, BOE will suspend some LCD panel production line plans to improve the imbalance between supply and demand of LCD panels.
According to UIPOS survey data, the global supply and demand for LCD panels remained loose in the third quarter, with prices for various panel sizes experiencing sharp declines in August. However, the effects of production control began to materialize in September. Prices for small-sized LCD panels remained largely stable, while medium and large-sized LCD panels may continue to see a downward trend, albeit with a reduced rate of decline.
UIPOS also reviewed historical price change data for LCD panels and found that LCD panel prices began to rise sharply in June 2020, peaking in September 2022 before starting to fall. From the fourth quarter of 2022 to the first quarter of 2023, LCD panel prices decreased but rebounded in the second and third quarters of 2023. UIPOS anticipates a further 3% decline in LCD panel prices in the third quarter of 2024 compared to the previous quarter.
The shipment volumes and prices of LCD panels are influenced by multiple factors. Major sporting events such as the 2024 European Cup and the Paris Olympics, held in Europe, will drive increased demand for LCD panels. In the first half of the year, global LCD panel shipments reached 120 million units, reflecting a 0.6% year-on-year increase. However, in the second half of the year, global supply of LCD panels is expected to remain relatively loose, with demand anticipated to fall. UIPOS predicts that global LCD panel shipments in the second half of 2024 will total approximately 110 million units, a 7% decrease compared to the first half of the year.
As BOE suspends the implementation of production plans for certain lines in response to the overall decline in LCD panel prices, the POS industry will inevitably be affected to some extent. For instance, prices for 14-inch, 15-inch, and 15.6-inch POS hardware are expected to rise compared to the first half of the year. Consequently, software vendors should plan ahead when purchasing POS hardware to avoid exceeding their budgets.