MARCH 08 W3 ALERT
TV Makers: Small is the New Big
Several Japanese TV Manufacturers Shift Production to Smaller Flat Panel Sizes
<MARCH 18, 2008><NIKKEI/TOKYO>In a significant strategy shift, several television manufacturers in Japan have told the Nikkei that they are shifting their production away from large sized flat panel TV sets to smaller and midsize dimensions. The makers cite a deteriorating earnings environments (yen vs. the dollar) and dampened consumer sentiment in North America.
This change of strategy is a dramatic reverse from plans shown less than ninety days ago at the Consumer Electronics Show where many manufacturers, such as Sharp and Matsushita, were showing MEGA sets like the 108" Sharp Aquos set shown at right.
Sharp Corp. had recently upgraded their LCD panel production facility in Mexico to produce 40- and 50-inch TVs for the North American market. However, in the face of the declining U.S. economy and consumer sentiment, Sharp has totally changed their plan. Originally, Sharp's panels were only used in Sharp products. Now, however, 20% of the plant's output will be sold to OEM customers primarily for 32-inch sets.
Mikio Katayama, president of Sharp Corp. said, "We changed the strategy in July because of a plunge in North American sales of large-screen TVs."
Matsushita Electric Industrial Co. will add a new 37-inch model in order to fill out the midsize segment of their lineup. "Demand for the main TV at home has run its course," according to a Panasonic AVC Networks Co. official, suggesting that the market is moving to secondary sets now.
Sony is also said to be strategically emphasizing 26- to 37-inch models as much as it larger screen sizes...it had previously planned to only emphasize the larger sets.