Featuring analysis from

  • DisplaySearch
  • Solarbuzz

LCD Monitor Brand Share-Shift Expected after Lite-On China Factory Fire but no Indications of S/D Change

Lite-On Technology, the fifth largest producer of desktop monitors in the world (on an OEM/ODM basis), announced to the Taiwan Stock Exchange on February 3 that they had a major fire in their Southern China production facility. The fire reportedly destroyed 16 of their 20 monitor lines. Lite-On also produces LCD TVs in this same factory, but these lines were not impacted and their LCDTV production pales in comparison against their LCD monitor production.

Figure 1 Q3’07 Top LCD Monitor OEM/ODMs

Rank

OEM/ODM

Q3’07 Units (000s)

Q3’07 Share

1

TPV

9,554

21.6%

2

INNOLUX

7,501

17.0%

3

SAMSUNG

5,501

12.4%

4

LGE

3,489

7.9%

5

LITE-ON

3,450

7.8%

This could have a major impact on the landscape of the desktop monitor industry in Q1’08 and Q2’08 but most probably in regards to share-shift rather than in overall Supply/Demand. While the pre-planned down-time associated with the Lunar New Year celebration will help sort out the impact, brands such as Dell, HP and Lenovo could be impacted the most. DisplaySearch’s current Quarterly LCD Monitor Value Chain Report shows that Dell and HP were Lite-On’s top OEM partners in the recent quarter with Acer, Lenovo and NEC being other major customers. Current production rates for these brands by Lite-On show that 22% of HP’s production of LCD monitors in Q3’07 was performed by Lite-On vs. 20% of Dell’s and 19% of Lenovo’s. While most of these brands are dual sourced (with more than one OEM making identical products for them), this could continue to cause a major share shift in the desktop monitor industry. Dell has been losing share to stand-alone monitor brand Samsung for the past few quarters, and a disaster such as this could impact their worldwide share even more in the coming months. Dell is quite resilient, nimble and customer-focused, and has the ability to provide their customers with non-Dell branded displays in a time of shortages, substituting (for example) an NEC 19” Wide display for a Dell 19” Wide display, so the overall financial impact to Dell may not be that severe, but it seems this fire will indeed shift share to those brands who did not use Lite-On as a major supplier. The impact could be the most severe in the North America market, where Dell typically accounts for over 30% of the monitors shipped in any given quarter.

Figure 2 Q3’07 Top 5 WW Brand Rankings

Q3’07
Rank

Brand

Q3’07

Q3’07 Share

Q2/Q3 Change

1

SAMSUNG

6,218

14.5%

14.9%

2

DELL

5,709

13.3%

-1.8%

3

HP

4,572

10.7%

12.3%

4

LGE

3,926

9.2%

7.7%

5

ACER

3,233

7.5%

9.3%

Indications as of this writing are that since key materials (such as the LCD panels themselves) and the tooling for the various displays were not impacted, that the overall impacts to the total supply of desktop monitors in Q1 and Q2 can be mitigated if either Lite-On outsources its own production to local competitors, or brands themselves shift production allocations to Lite-On’s competitors. If these transitions are smooth, then there should be minimal impacts to the overall Supply/Demand for monitors in the near term but DisplaySearch will indeed keep a watchful eye open in case the transition is not smooth and the Supply/Demand equation begins to be impacted.

  • NISHAD AHAMED

    we are from sri lanka.our company sells more than 500pcs per month samsung l.c.d monitor.there fore we are looking best prices samsung l.c.d.monitor.please reply me with your price list