Taiwan-based makers (excluding Sharp) flogged 62.38 million units in the fourth quarter of 2018, down 3.7 percent sequentially and shipments are expected to fall another 8.4 percent sequentially in the first quarter of 2019.
Digitimes Research had originally expected a 3.3 percent drop due to Chunghwa Picture Tubes' (CPT) financial crisis but it looks like things are going to continue to get worse.
CPT's financial crisis is expected to undermine Taiwan's 9-inch and above tablet panel shipments with the volumes slipping 23 percent sequentially in the fourth quarter of 2018 and they will decline by another 15.6 percent on quarter in the first quarter of 2019..
Taiwan's TV panel shipments performed better than expected in the fourth quarter of 2018 credited to AUO and Innolux's strong shipments of 40-, 50-, 58- and 65-inch panels, ordered by vendors including TCL and Hisense, as the sizes of panels are only seeing limited supply from China makers.
Seasonality, Singles' Day promotion campaigns in the fourth quarter of 2018 advancing some demand that should have emerged in the first quarter of 2019, and TV vendors turning conservative about building inventory amid falling panel prices will all contribute to the weakening in TV panel procurement in the first quarter of 2019, the report said.
AUO saw losses in its panel business in the fourth quarter of 2018 and is expected to conduct annual maintenance, trial production for new products and shift some TV panel capacity to manufacture monitor panels to maintain its use rate and prevent the losses to expand in first-quarter 2019.