Global TV set and display panel market research firm TrendForce has once again adjusted down its forecast for full year 2022 volume for TV sets of all types to 202 million units, down 3.8% from full year 2021.
At the start of the year the firm had forecast 217 million units over the course of 2022, but has revised that forecast several times due to on-going hardships with global inflation, reduced consumer demand, the Ukraine crisis, disrupted shipping logistics and other problems that have emerged since the outbreak of COVID-19.
According to data released by TrendForce last week, global TV industry shipment volume from the second quarter of 2022 was 45.17 million units, down 5% quarter on quarter and 6.8% year on year, and 92.72 million for the first half of 2022, down 58% year on year. This was the first time shipments fell below a record low of 46 million units in the second quarter, the firm said.
TrendForce said the economies of Europe and the United States have been hit by rising inflation and interest rate hikes, which has contributed to a general decline in consumer demand for TVs and other discretionary purchases.
In addition, the rekindled spread of COVID-19 in China forced lockdowns and a dynamic zero-COVID policy, that interrupted manufacturing and shipping for a period, impacting TV deliveries to all parts of the world.
“These three major TV sales regions are facing different facet of economic issues, seriously affecting overall shipments and sales,” TrendForce said. “TV shipments from Samsung and LG, mainly sold in Europe and the United States, were revised downward by nearly 30% in 2Q22 and, with a combined market share of nearly 32%, this development sent shockwaves through on the market.”
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With the latest Q2-2022 TV volume data, TrendForce said global TV shipments for the first half of 2022 reached 92.72 million units, down 5.8% year on year.
The disruptive events mentioned have all contributed the previous forecast misses, resulting in rising inventory levels, the firm said.
“It has become a foregone conclusion that there will be no peak in the 2H22 peak season for TV shipments,” TrendForce’s data announcement said. “..Although TV brands are actively creating new promotion opportunities, if results are not as expected, continued risk of annual shipment volume being downgraded to below 200 million units cannot be ruled out.”
One brand that has been able to capitalize on the market dynamics has been China-based Hisense, which jumped into second play for global LCD TV shipment share, TrendForce said.
“Both TV panel prices and shipping costs have fallen significantly this year, helping brands increase promotions in terminal markets. However, rising inflation in Europe and the United States has caused a sustained rise in terminal inventory, so destocking has become TV brands’ primary goal this year. The two major TV brands Samsung and LG are primarily sold in North America and Europe and have borne the brunt of market forces since they account for nearly 50% of shipments,” TrendForce found.
The research firm said it expects Samsung to have a battle on its hands to reach 38 million units shipped this year, down 8% from a year ago.
LG has at the same time managed “marginal growth” in OLED TV shipments, due to the rapid decline in demand for LCD TVs, but the company’s annual LCD TV shipments likely will not escape contraction, reaching 25.74 million units, a decrease of 11.6% year on year, and dropping LG’s LCD TV shipments to fourth place for the first time, TrendForce said.
Hisense, on the other hand, behind its sub-brand Vidda, has focused on cost-effective products and has successfully gained favor with young and frugal Chinese consumers.
Hisense’s LCD TV shipments this year are estimated to reach 22.76 million units, an annual increase of 4.3%.
“Not only is Hisense the only brand to grow among the five major brands, it has for the first time, simultaneously taken second place in LCD TV shipments,” TrendForce said.
As for Hisense’s rival TCL, the Chinese TV manufacturer “has actively cultivated overseas markets in recent years and, currently, its proportion of export sales has reached 75%. However, sluggish demand in Europe and the United States has indirectly affected TCL’s shipments to a tune of 21.8 million units this year, a decrease of 3.6% year on year. Like Hisense, TCL manufactures primarily LCD TVs.
Another major Chinese TV brand, Xiaomi, is also seeing its domestic market share being gradually eroded by the success of Hisense’s Vidda, TrendForce said.
Xiaomi (which doesn’t currently sell TV sets in the U.S.) has benefitted from recovered TV demand in the Indian market this year, acting as a backstop for this year’s shipments to remain flat at 13.06 million units, TrendForce said. Xiaomi has also recently started selling OLED-based TVs.
As for OLED TVs, TrendForce said TVs using the emissive panel technology are being squeezed by falling LCD TV panel pricing, resulting in the technology’s 2022 shipment growth rate contract to 7.8%
“TV sales were weak this year but panel manufacturers continue to invest in new production capacity, resulting in an expansion of the supply/demand glut ratio of TV panels and whole devices to 35%, the most severe oversupply in the past five years,” TrendForce cautioned. “As a result, the price of LCD TV panels has been in a sustained decline since 2H21. This year’s decline has caused LCD TV prices to not only fall below the lows of 2019, but also blow through cash costs. TrendForce forecasts LCD TV shipments at approximately 195 million units this year, down 4.1% year on year.”
LG Display, a major supplier of OLED TV panels, maintained its quotations through product specification upgrades this year but the price gap between OLED and LCD TV panels continued to widen, TrendForce said.
The price differential between a 55-inch UHD OLED panel and UHD LCD panel has expanded from a multiple of 1.8 to 4.8 this year.
This caused Samsung to delay its 2022 mass production schedule of OLED sets (which was reportedly to include WOLED-panel based sets from LGD in addition to the QD-OLED panel based models from Samsung Display that Samsung Electronics is selling how.
It also resulted in the annual growth rate of OLED TVs contracting to single digits at 7.8% and 7.23 million units, TrendForce said.
“LG has a market share of 58% in OLED TVs and Sony maintains a 20% share. Ultimately, Samsung delayed the launch of its White OLED TVs for a year. With only QD-OLEDs acting as a backstop this year, the company’s market share reached 6%,” TrendForce said.
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By Greg Tarr
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