China’s dominant LCD panel manufacturers are moving to raise prices on large TV panels. The push could lift the cost of Samsung, LG and Sony TVs heading into Black Friday, Christmas and Boxing Day, the most important selling period of the year for Australian retailers.

BOE Technology and TCL have told customers it will apply revised prices from the fourth quarter, what’s not known is who will have to absorb the increases as supply pricing for Black Friday orders was placed months ago.

It cited higher procurement and supply costs driven by volatile raw-material prices and shifts in global supply and demand. TCL CSOT has also increased prices, and HKC is expected to follow.

The increases land as brands place orders for the peak season and as Australian TV sales remain flat. The Good Guys is among the few retailers benefiting, on demand for large-screen replacements.

Output Held Back To Prop Up Prices

Some major Chinese LCD TV panel makers are running at around 70% utilisation following a global slump in TV sales. Analysts said manufacturers could lift output but are instead holding production back to stabilise the market and prevent persistent oversupply from dragging prices down.

“Major panel makers are planning extended production adjustments to balance supply and demand and support panel prices,” TrendForce said in its latest report, which forecast price movements this month across TV panels of all sizes.

“Display panels account for a significant portion of a television’s manufacturing cost,” an industry official said.

Brands Face Margin Squeeze

South Korean TV industry officials told The Korea Times that if the increases go ahead, set makers will have three options. They can absorb the cost, find savings on other components or negotiate higher prices with retailers.

Budget TVs are expected to be hit hardest. Competition in that segment is intense and margins are thin, leaving brands little room to lift shelf prices without losing sales. That pressure is greater as Chinese TV brands push harder into overseas markets.

RGB Micro LED TV by Samsung.

China Controls The Large-Panel Supply Chain

The price push reflects China’s grip on large-panel supply. BOE, CSOT and HKC have expanded capacity over the past decade while rivals in South Korea, Japan and Taiwan retreated from LCD because of weak profitability.

Samsung Display ended LCD production in 2022. LG Display later halted TV LCD manufacturing in South Korea and sold its Guangzhou plant. Taiwan’s AUO and Innolux have also cut capacity.

BOE, CSOT and HKC now supply an estimated 70% to 85% of 65, 75 and 85-inch TV panels, according to industry data. Their share of some ultra-large categories is even higher.

Production Cuts Have Worked Before

Chinese panel makers have used output cuts to support prices in the past. In March 2023, prices for 32 to 55-inch TV panels rose 3% to 5% month on month, while 65-inch panel prices jumped as much as 9%. The price of a 65-inch panel rose a further US$13 in April that year.