August 16, 2001

The Market Intelligence Center (MIC) of the government-supported Institute for Information Industry (III) forecasts that Taiwan's LCD monitor exports would gradually increase this year and in 2002. Since last year, the Taiwan LCD monitor world market share reached 45,5% with total shipments of 2.92 million pieces and the forecast for this year will be 8.43 million units with a global share of 55.9%. In the third quarter, 30% will go to China.

In Taiwan, according to local news, on company is to become the nation's biggest LCD monitor maker, while a new kid on the block aspires to become a "first tier" manufacturer.

Acer Communications & Multimedia Inc. said it expects to be the largest one this year. ACER CM sold 310.000 TFT-LCD monitors during the first half of this year. In July alone, thanks to orders from Japan's biggest five computer makers and Taiwan's Acer Inc. itself, Acer CM delivered more than 90,000 monitors in July and estimates the delivery volume at 150,000 sets in August. In the third quarter, Acer CM expects to deliver 400,000 and in the fourth quarter 500,000 FTF-LCD monitors, thus resulting in a total of 1,2 million units this year, exceeding by far the 800,000 sets forecast at the beginning of this year.

Of Acer CM's production, 40% is for sale on the global market under the brand Acer and 60% for international OEMs.

Currently, the monthly sales of the after main players in the field are Compal with 80,000 to 100,000, Amtran and Optoma each with 50,000-70,000, and Lite-On and Jean Co. Each with 20,000 - 30,000.

Sampo Technology reports that it has been actively developing its LCD monitor business this year, aiming to become a first-tier LCD monitor company. LCD monitors accounted for 40% o the company's sales so far this year, with a target for 2001 set at 400,000 to 500,000 units.

Currently, 17" LCD-Monitors enjoy an 80% share of the total output.

Sampo has LCD monitor production lines in Taiwan and may also consider building production lines in China.

News from the downstream supply market

As LCD monitors become ever more popular to replace bulky CRT monitors for desktop operations due to more affordable prices, it is this price war having an impact on the supply market. The worldwide production volume of large TFT-LCD modules, the base part of LCD monitors, has been brisk, but its value is declining.

According to a survey conducted by Nikkei Market Access, the production value dropped by 24% in the first quarter of this year compared to the same period of last year. In monetary terms, the production value was US$2,570 million in the second quarter- The total production value for 2001 is estimated to fall by 17% from the pervious year to US$ 11 billion. This 17% drop is the worst in five years.

The decrease in production value in spite of the increase in volume is, of course, due to significantly lower prices accepted by the market. Prices for almost all sizes of large TFT-LCD modules for notebook PCs and LCD monitors have fallen to almost half of the amount from the previous year.

All in all, the TFT-LCD industry has led to the development and localization of supporting industries. Now almost all the key components for TFT-LCD monitors can be sourced within Taiwan, including LCM (Liquid Crystal Display Modules) COG ( Chips on Glass ), filters, substrates, back light modules, and driver ICs. These component industries have formed a solid structure, which creates a huge demand in Taiwan for a full spectrum of production equipment and materials as well.

Local manufacturers estimate for example that a TFT-LCD plant costs around US$ 600 million to built. L.P. Hsu, a senior consultant at Philips Taiwan Ltd. said: "The global shortage of TFT-LCDs has pushed up profit margins for this product. Domestic firms have to invest in TFT-LCD production because these displays will eventually replace traditional cathode-ray tube displays in mainstream desktop monitors, and TN and STN LCDs as the main display for notebook computers."