2011 Display Device Price Freefall

Market Report on Used and Refurbished LCDs

The used CRT display device market has been on a slide for some time.  We have one of the only, and best, CRT refurbishing factory account purchase orders (which includes certified recycling of incidental breakage and parts recycling).  But the orders there have been cut from 180,000 units per month in 2006 to 5,000 units per month in 2011.

Part of that pressure comes from supplies from within Asia itself.   Office buildings in Hong Kong, Shanghai, Kuala Lumpur, Singapore, Taipei, Seoul, and Jakarta were replacing their working CRTs in mass between 2008-2010.   Even steady demand in Africa, South America, and the Mideast was fulfilled cheaply by Asian supply.  Shipping from the East Coast of the USA through the Panama Canal, across the Pacific, for refurbishing in Indonesia, and shipping back to Egypt... that was more expensive than refurbishing locally for export.

That, by the way, was one of the big factors to the "California Compromise" collapsing a year ago this month.  While BAN and California explored the idea of setting high standards for Asian Refurbishers to meet, the Asians decided it was too little, too late.

Now, the same thing is happening with used LCD prices.   Below is an excerpt from one of my favorite, Taiwan-based trade journals.  Today there is oversupply in the large (new) LCD market causing layoffs and work stoppages, and some factories are going back to cutting LCDs into smaller sizes and targeting the same emerging markets as refurbishers.

USA Poster Child

One benefit of WR3A membership is that our buyers overseas generally practice loyalty... "Dance with the girl what brung ya" has no direct translation in Chinese, and at times the concept of "loyalty" seems are rare as snow in Cairo.   But it's a universal that in uncertain markets, knowledge and history between buyer and seller is the only thing that goes up in value.

Click "more" below for text of the article.   Note references to multi-billion dollar OEMS like Chimei Innolux (CMI), Amtran Technology, and AU Optronics (AUO).    No one I mention these names to in the USA "E-waste" market knows they exist.  It's another example of how American do-gooders are making policy about electronics "take back" without even knowing where the devices came from.  Guiyu China does exist, but having Guiyu represent "Chinese electronics" is like having Tombstone Arizona represent the USA.

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Digitimes  9/30/2011

Large-size LCD panel makers are taking austerity measures, including adjusting workers' days off and a tighter cost control, to face continuing losses in the market, according to industry sources.

Shortage of orders has caused their utilization to become low, and workers may also be asked to take unpaid leave if there is no recovery in sight, the sources said.

Chimei Innolux (CMI) has slashed its capex for 2011 to NT$50-60 billion (US$1.64-1.97 billion) from the previously planned NT$100 billion and has since August encouraged workers to take days off. CMI said that the company is not asking its employees to take unpaid leave but has cancelled a flexible workday policy so employees take days off on the same days. The company said that the days off are paid.

AU Optronics (AUO) has cut 30% of its 2011 capex to under NT$70 billion from NT$90-95 billion, and said there may be further cuts. AUO chairman KY Lee recently said that the large-size panel industry has not reached its bottom and that AUO is engaging in a tighter control of cost by reducing employees' business trips, as well as the number of employees going on business trips.

Amtran Technology, a major TV supplier of Vizio, has been said to have cut its shipment goal for 2011 due to its flat performance in the first half of the year. Sources in the supply chain said that Amtran has reportedly reduced about 10% of its manpower after layoffs in March, May and July. The company is also asking employees to take unpaid leave, the sources added. Amtran said the company's priority is protect profitability, given the conservative outlook in second-half 2011.

But makers who have shifted to small- to medium-size panels are faring much better. Chunghwa Picture Tubes (CPT) and Giantplus have been raising utilization rates to cope with increasing orders for the second half. CPT and Giantplus said they have no plans to implement any unpaid leave policy.

Giantplus, benefiting from orders for digital still camera (DSC) applications, has seen shipments of 2.5-3.5-inch panels grow. Touch panel suppliers, including makers of touch sensors and cover glass, have been said to be expanding their manpower.