China Flat Panel TV Shipments Jump To 6.12 Million

China's flat panel TV (LCD and plasma) shipments in 1H 2008 reached 6.12 million, up 84.9% YOY. Flat panel TVs continues to grow rapidly, and account for 30% of China's total color TV shipments in 1H 2008.

The Beijing 2008 Olympics in August had a simulative effect on flat panel TV sales, overcoming the negative impacts of China's major snowstorm and Sichuan Earthquake. As the Olympics approached, vendors maximized their promotional and marketing opportunities.

Flat Panel TV	1H06	1H07	1H08
Shipments, in thousands	1,463.7	3,308.5	6,117.9%
YOY Growth (%)	117.0%	126.0%	84.9%

1H08 shipments of LCD TV screen sizes above 40" accounted for 35.4% of all LCD TV shipments, while 32" sized was 34.8%.

LCD TV Screen Size	1H08 Shipment Share (%)
15" – 20"	8.7%
21" – 30"	10.0%
32"	34.8%
37"	11.1%
40" – 42"	25.6%
46" – 47"	8.2%
47" and Above	1.6%
Total	100.00%

In 1H08 LCD TVs, Samsung leads with a shipment share of 10.3%, followed by Hisense at 9.4%, and then Skyworth at 8.2%. Sony's share grew rapidly to 7.9%, followed closely by KONKA at 7.7%.

Multinational vendor brands, traditionally positioned at the high end, have come down with more economical products. As their prices have come down, their market shares have increased rapidly. Chinese domestic brands have focused on improving service quality, channel development, and branding.

LCD TV Vendor Brand	1H08 Shipment Share (%)
Samsung	10.3%
Hisense	9.4%
Skyworth	8.2%
Sony	7.9%
Konka	7.7%
Philips	7.5%
Toshiba	7.3%
Changhong	7.2%
Sharp	7.0%
TCL	6.5%
Others	21.0%
Total	100.00%

Vendors seized the Olympics opportunity to promote plasmas' advantage for sports viewing. Together with the launch of 37" plasma TVs, the share of plasma TVs (to LCD TVs) in 1H08 was 11.4%.

Flat Panel TV	1H07	1H08
Plasma TV Shipment Share (%)	92.1%	88.6%
LCD TV Shipment Share (%)	7.9%	11.4%
Total	100.0%	100.0%

Not surprisingly, vendors maximized their marketing efforts around the Beijing Olympics. They framed product advantages around the Olympics viewing experience: large to super-large screen sizes, full high definition, HDMI, and high refresh rates.

Vendor sponsorships and partnerships with China's popular sports team were key strategies; KONKA with China's national sailing team, CHANGHONG with China's table tennis team, Skyworth with China's shooting team, TCL with China women's tennis team, and Samsung with China's gymnastics team and Gymnastics Association. Panasonic was the Olympics global partner.

TRENDS TO WATCH

With the highly popular Beijing Olympics as a catalyst in China, flat panel TVs will continue to grow:

CCID Consulting projects that flat panel TVs will account for 40% relative to CRTs. As China's living standards continue to rise, flat panel advantages become more affordable. The government also supports the domestic industrial development of flat panel production, further fueling industry growth.

Multinational vendors such as Samsung and Sony are strengthening their channels in these markets. Chinese domestic vendors are adopting renewed efforts as well.

KONKA continues to build rural outlets, numbering in the thousands, to promote its flat panel TVs. Hisense will strengthen its Tier 3 and 4 city reach with 20,000 outlets and partners. Haier has also stepped its efforts in rural channels development.

Some Chinese domestic vendor brands are turning to plasma TVs. CHANGHONG showcased its plasma display in the China International Consumer Electronics Show (SINOCES) in Qingdao and its production capability, while Panda also released plasma TVs. Other Chinese domestic vendors are increasing their investment and attention to plasma TVs as well, such as Skyworth, Hisense, and KONKA. Chinese consumers are also better aware of plasma advantages, especially after the Olympics.

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Unless otherwise specified, all information provided is sourced from CCID Consulting.