Omdia: Panel Makers Increase Fab Utilization Plans By Three Consecutive Months And Maintain 80% Utilization Rate In 1Q 2025
Date
1/16/2025 5:16:23 AM
(MENAFN- PR Newswire)
"The upward revision of fab utilization plans is mainly driven by increased demand for special TV panels spurred by Chinese government's 'Swap Old for New' subsidy program, which is yet to be fully realized. Leading China TV makers are positioning themselves to capture greater market share during this surge in demand by securing additional TV panels." said Alex Kang, Principal Analyst of Omdia .
"The anticipated tariff risks under the newly elected US government have temporarily driven up demand for LCD TV panels, impacting panel makers' fab utilization plans. Some China TV makers are increasing their TV inventories in Mexico to facilitate shipments to the US market. Additionally, the rush orders have also heightened the risk of component shortages, such as driver ICs (integrated circuits) and polarizers, especially for IT LCDs manufacturing. Concerns over these supply issues have further fueled demand, leading to additional upward revisions in fab utilization plans," added Kang.
The upward revision of panel makers' fab utilization plans has been led primarily by major Chinese panel makers, such as BOE, China Star, and HKC Display. These panel makers are more significantly impacted by the Chinese government's subsidy program due to their higher share of LCD TV panel production and supply to China TV makers.
Initially, Chinese panel makers had considered taking the two-week holidays during Lunar New Year at the end of January 2025 and reduce LCD TV panel production to maintain bargaining power over panel pricing. However, with increased panel demand and expected price hikes for LCD TV panels in the first half of 2025, some fabs have cancelled the holiday plans entirely, opting instead to sustain high utilization rates.
"Despite the current pull-in demand and strong utilization rates, panel makers remain cautious about mid to long-term demand trends. They may revert to production-to-order strategies once this demand surge subsides," concluded Kang.
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SOURCE Omdia
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