The color TV market is expected to achieve a turnaround in the second half of the year. Can the loosening of LCD panel prices become a breakthrough for the industry?

As the second quarter comes to an end, the situation in the color TV market does not seem optimistic.

Take the current performance of China's color TV companies as an example. The profits of the country's five major color TV manufacturers have all declined, making it the worst performance of the color TV market in recent years.

However, it is not just the Chinese color TV market that has suffered a severe decline. It is reported that in the first half of this year, the global TV market as a whole performed poorly, with China, North America and Europe all experiencing market downturns, and the global TV industry has coincidentally experienced product backlogs.

Under such circumstances, the inventory cycle of Chinese color TV manufacturers has increased from 6 weeks in normal times to 7.4 weeks, while that of overseas manufacturers has increased to 10.6 weeks.

To this end, Samsung Electronics, a global TV manufacturing giant, has reduced its full-year sales target for 2017 from the previously set 48 million units to 44 million units.

The operating pressure of the color TV market in the first half of 2017 was mainly reflected in the price increase of upstream panels and the difficulty of operation under low profits. So, can the color TV industry, which is under heavy pressure, get rid of the current difficult situation in the second half of the year?

The color TV market continues to perform poorly, with price fluctuations being the main reason

Before answering this question, we need to understand why the color TV market continues to be sluggish this year.

First of all, the reasons for the "downturn" in the global and domestic color TV industries are inseparable from price instability.

Since the second half of 2016, the price increase trend in various industries and consumer goods has intensified. The cost pressure of home appliance companies was fully demonstrated in the first half of 2017. The prices of both "black appliances" and "white appliances" have rebounded to varying degrees and the sales volume has declined.

After the color TV industry suffered from a 14-month-long increase in panel prices, a long period and high amplitude have become the consensus of the industry. In addition, the concentration of color TV brands is low and there are many new brands, so the risks and impacts brought by cost growth are more severe. In addition, the multiple real estate regulation policies have also exacerbated the instability of the color TV consumer market.

In addition, the growth of color TV performance and the brutal growth of the industry in the past two years have also become important factors.

Especially under the stimulation of the Internet brand model, the market demand for color TV products this year was digested in advance. At the same time, the sales volume of color TVs reached a new high in 2016, which also overdrew the sales scale to a certain extent.

However, after the panel market entered a relatively stable state in February and March this year, prices of almost all sizes of panels have fallen since June.

Perhaps, the decline in panel prices not only alleviates the cost pressure of whole-machine enterprises to a certain extent, but also lays the foundation for the breakthrough of the TV industry in the second half of the year.

Cost reduction brings a turnaround to the industry, and the color TV market may pick up

It is worth mentioning that as panel prices continued to rise in the first quarter, sluggishness became synonymous with market performance.

Now we are in the transition period of panel price loosening, the price growth rate is slowing down and stabilizing, and the market is gradually showing vitality. In the next six months, the color TV market may gradually move in a more optimistic direction as the panel price increase gradually tightens.

Just as the relevant forecast data shows, under the influence of the panel price reduction, the color TV market will continue to maintain its growth trend. It is estimated that the annual retail volume of China's color TV market will reach 53.01 million units, a year-on-year increase of 4.2%, and the retail sales volume will reach 164 billion yuan, a year-on-year increase of 5.1%.

It is precisely because there is no hope of rising TV panel prices in the second half of the year that the TV market has the possibility of breaking the "frozen period" of nearly half a year.

However, although the price drop of upstream raw materials such as panels has given color TV manufacturers more room for maneuver, they should also be wary of the color TV market falling into the quagmire of price wars again in the second half of the year.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.