According to sources, AU Optronics, the second largest LCD panel maker in Taiwan, reduced its glass orders by 15% in June and plans to reduce its capacity utilization rate to 80% in July to reduce the current level of panel inventory. Taiwanâ€™s largest panel maker Chi Mei and South Koreaâ€™s two giants, Samsung and LG Display, also said that they plan to cut production to protect panel prices.
It is reported that the high inventory level of the LCD panel industry has caused panel prices to begin to decline in June, and large panel makers have tried to reduce production capacity as a strategy to resist the downward trend in prices. While reducing glass orders, AU Optronics hopes to reduce its capacity utilization rate in the third quarter from the current 85% to 80%. Chi Mei also plans to reduce the capacity utilization rate from 90% to 80%. Samsung and LG Display Division will reduce the production capacity in the second quarter by another 5% in the third quarter.
WitsView analysis shows that downstream customers have a conservative stocking attitude before the peak season. If panel makers do not adopt production cuts to balance the market oversupply situation, for the panel makers, the peak season in the third quarter will cause panel prices to rebound without hope and lose. Turning profit opportunities.
Yesterday, WitsView released the panel shipment forecast for the third quarter, and the growth rate in the third quarter was only 3%-5%. Due to weak global market demand, panel makers have already begun to consider ensuring profits through production cuts.