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Musing on Displays
 
Coronavirus Adds Complexity to Panel Pricing Issues
February 09, 2020

Over the last few weeks the industry has seen at least four issues that play into panel pricing, and while overall panel pricing is expected to stabilize, each application category has its own characteristics for February.
 
Table 1: Demand/Supply by Application

Source: SCMR LLC

All in, the Coronavirus is the most impactful and in the short-term will be more difficult to maintain consistent output as some workers remain in quarantine or are facing restricted travel, while dormitory living for many factory workers could increase the risk of the virus spreading.  Panel producers with fabs in Wuhan or other locations in the region will try to resume post-holiday production on February 10th, but concerns remain as to the ability for these fabs to run without full staffing.
 
Table 2: Impact of Changes in Panel Production

Source: SCMR LLC

There is also the psychological effects of the contagion and will have some impact on non-essential purchases.  Perhaps over time this will lessen, especially if the spread of the virus is limited, before things return to more normal buying patterns.
The interim trade agreement would have had a bigger impact on the Chinese CE economy if the Coronavirus had not occurred at roughly the same time, and while the agreement likely assuages the fears of industrial buyers, the virus, at least temporarily increases them.  LCD capacity reductions in South Korea and Chinese LCD expansion likely increase the disparity between smaller and larger TV prices with timing the essential pointer toward price patterns for the 2020 year.