Manufacturers of LCD panels will need to set realistic prices for their product, as the battle for market share among PC companies heats up, it has been claimed.

During the first two quarters of the year LCD manufacturers have enjoyed impressive returns as a result of six months of rising prices. In order to furnish this demand, many firms have expanded their business and have lobbied for prices to be raised further.

However, should this occur the higher costs could be passed along the supply chain and raise prices for PC monitors, according to market research firm iSuppli.

This in turn could hit consumer demand during 2008, with a knock-on effect of slowing production of LCD screens, the glass for which is manufactured using platinum/rhodium equipment.

Also likely to impact on LCD manufacturers' business is the fact that Hewlett-Packard, Dell, Lenovo, and Acer, which dominate the market for PCs, have stockpiled LCD monitors in a bid to increase their market share and are therefore unlikely to maintain the same level of orders as has recently been evident, iSuppli claims.

Rhoda Alexander, analyst with iSuppli, told Information Week: "The pileup is starting at the end of the supply chain, and you have to pay attention to it to avoid congestion in the manufacturing level."

Ms Alexander added that a return to healthier market conditions would only follow "a long period of adjustment during which panel pricing drops and overpriced inventories clear".

Source:

Analyst: Hard times ahead for LCD panel makers, 09/10/07

http://www.eetasia.com/ART_8800482717_480700_NT_04403ad3.HTM?1000013726&8800482717&click_from=1000013726,8620774991,2007

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