Deliveries of glass substrates to thin film transistor-liquid crystal display (TFT-LCD) manufacturers might only increase an annual 4% in the 4Q 2008, according to data released recently by leading fl…
Deliveries of glass substrates to thin film transistor-liquid crystal display (TFT-LCD) manufacturers might only increase an annual 4% in the 4Q 2008, according to data released recently by leading flat panel display (FPD) market researcher and consultancy DisplaySearch. In the 4Q 2007, DisplaySearch said, the year-on-year growth of substrate shipments was 31%. Since the 2Q 2008, TFT-LCD producers have began adjusting capacity utilization to compensate for falling panel prices, the market-research firm said, and adjustments are still being made. DisplaySearch also reported that capacity reductions began earlier in the current business cycle than in previous ones, and the effect on glass substrate suppliers was sudden and unexpected. Glass suppliers have replied by planning reductions in their glass furnace utilization and adjusting prices. As a result, while substrate area shipments are increasing, sales revenues are increasing more slowly. David Barnes, DisplaySearch vice president of strategic analysis, said that about two-thirds of Corning“s glass substrate capacity is located in Taiwan so local TFT-LCD companies affected Corning more than other suppliers. Utilization reductions by South Korean panel makers were less severe and demand for Samsung Corning Precision glass was stronger, he added. The vice president added that to operate through this TFT-LCD business cycle is challenging for glass suppliers because total demand continues to grow. In the 1Q 2008, substrate area shipped increased 47% from a year earlier, but capacity increased only 37%. Suppliers need more capacity, but must be prudent, Mr. Barnes said.