The winter in the panel industry also kept the executives from sitting. Following LG Display’s announcement that its current CEO Quan Yingshou will be relocated in 2012, Taiwan’s panel leader Chi Mei’s chairman and deputy chairman both resigned. People in the industry generally believe that LCD panel prices have declined for 16 months in a row, making panel companies miserable and unable to complete their established performance targets. Senior executives are forced to leave or are forced to attend classes. However, the dismal situation of the panel industry is not easy to change, and the high-level shock is just the beginning.
Many panel industry departures
According to recent sources, Quan Yingshou will leave the LG Display CEO position in 2012 and transfer to the LG subsidiary to take charge of the company’s rechargeable battery business. LG Display explained that this new appointment is entirely for the purpose of strengthening LG Display’s global leadership.
CMO also announced recently that the chairman of the company, Liao Jinxiang, resigned from the chairman of the board of directors and the corporate director appointed by Chi Mei Industrial (Chi Mei Optoelectronics major shareholder) for personal health reasons; at the same time, Duan Xingjian, vice chairman of Chi Mei Optoelectronics, also resigned. Chairman of the board of directors, but still served as director and CEO of Chi Mei Optoelectronics. In addition, there was also news that Samsung's panel division shuffled its staff and cut out several top executives because of poor performance. However, the news has not been officially confirmed by Samsung.
Industry downturn has caused difficulties for companies
Owen Consulting analyst Yu Liangxing believes that the loss is the main reason for the conversion of these companies. In the third quarter of this year, the global panel industry was devastated and the panel makers in Taiwan were the hardest hit areas. Among them, AUO suffered a large loss of 15.796 billion yuan in the third quarter, accumulated losses in the first three quarters exceeded 40.4 billion yuan, and Chimei's third-quarter loss was 17.257 billion yuan, with cumulative losses in the first three quarters reaching 44.45 billion yuan. This year, Taiwan’s panel makers have lost a total of 120 billion to 130 billion yuan. In addition to Taiwanese-funded enterprises, LG Display’s operating loss of 492 billion won (approximately US$434.6 million) in the third quarter was externally described as “the worst quarter in historyâ€.
Yu Liangxing pointed out that the loss was mainly due to the continuous decline in panel prices. Industry organization Display Search data shows that panel prices have fallen for 16 consecutive months and have fallen below the bottom line.
High-level exchanges are difficult to solve the current difficulties
The reason why panel prices have so drastically dropped is that due to the weak demand for color TVs, China Unicom's data shows that in the past two years, the growth rate of LCD TV market has rapidly declined from the initial 90% to 20%-30%. LG Display’s vice president of public relations had previously asserted that panel prices are unlikely to recover this year. The industry insiders also agree with this view and believe that the continuous decline in panel prices has become the norm. This is not only a hopeless recovery this year, but also a bad market next year.
In order to reduce the amount of losses, the major panel companies also come up with many countermeasures. Samsung Electronics is planning to cut its output of LCD TV panels by 4/5 by the end of this year, and convert some of its production lines to the production of tablet PCs and notebook LCD panels.
As for whether the management’s shakeup can ease the current difficulties, people in the industry have different opinions. Luo Qingqi, chief advisor of Pare Consultancy Co., Ltd. admitted frankly that the home appliance industry is thirsty, and some companies even dehumanized their talents, thinking that replacing the leader could boost performance significantly. However, after all, the panel industry is not a problem of a single company, but the environment is not good, and even if you change the head, it is difficult to have the power to return. However, Yu Liangxing believes that although the losses are mainly due to industry reasons, various companies have encountered different difficulties in responding to the industry crisis, and the level of losses has also been different. The replacement of executives who are more familiar with the industry is still conducive to boosting performance.
Many panel industry departures
According to recent sources, Quan Yingshou will leave the LG Display CEO position in 2012 and transfer to the LG subsidiary to take charge of the company’s rechargeable battery business. LG Display explained that this new appointment is entirely for the purpose of strengthening LG Display’s global leadership.
CMO also announced recently that the chairman of the company, Liao Jinxiang, resigned from the chairman of the board of directors and the corporate director appointed by Chi Mei Industrial (Chi Mei Optoelectronics major shareholder) for personal health reasons; at the same time, Duan Xingjian, vice chairman of Chi Mei Optoelectronics, also resigned. Chairman of the board of directors, but still served as director and CEO of Chi Mei Optoelectronics. In addition, there was also news that Samsung's panel division shuffled its staff and cut out several top executives because of poor performance. However, the news has not been officially confirmed by Samsung.
Industry downturn has caused difficulties for companies
Owen Consulting analyst Yu Liangxing believes that the loss is the main reason for the conversion of these companies. In the third quarter of this year, the global panel industry was devastated and the panel makers in Taiwan were the hardest hit areas. Among them, AUO suffered a large loss of 15.796 billion yuan in the third quarter, accumulated losses in the first three quarters exceeded 40.4 billion yuan, and Chimei's third-quarter loss was 17.257 billion yuan, with cumulative losses in the first three quarters reaching 44.45 billion yuan. This year, Taiwan’s panel makers have lost a total of 120 billion to 130 billion yuan. In addition to Taiwanese-funded enterprises, LG Display’s operating loss of 492 billion won (approximately US$434.6 million) in the third quarter was externally described as “the worst quarter in historyâ€.
Yu Liangxing pointed out that the loss was mainly due to the continuous decline in panel prices. Industry organization Display Search data shows that panel prices have fallen for 16 consecutive months and have fallen below the bottom line.
High-level exchanges are difficult to solve the current difficulties
The reason why panel prices have so drastically dropped is that due to the weak demand for color TVs, China Unicom's data shows that in the past two years, the growth rate of LCD TV market has rapidly declined from the initial 90% to 20%-30%. LG Display’s vice president of public relations had previously asserted that panel prices are unlikely to recover this year. The industry insiders also agree with this view and believe that the continuous decline in panel prices has become the norm. This is not only a hopeless recovery this year, but also a bad market next year.
In order to reduce the amount of losses, the major panel companies also come up with many countermeasures. Samsung Electronics is planning to cut its output of LCD TV panels by 4/5 by the end of this year, and convert some of its production lines to the production of tablet PCs and notebook LCD panels.
As for whether the management’s shakeup can ease the current difficulties, people in the industry have different opinions. Luo Qingqi, chief advisor of Pare Consultancy Co., Ltd. admitted frankly that the home appliance industry is thirsty, and some companies even dehumanized their talents, thinking that replacing the leader could boost performance significantly. However, after all, the panel industry is not a problem of a single company, but the environment is not good, and even if you change the head, it is difficult to have the power to return. However, Yu Liangxing believes that although the losses are mainly due to industry reasons, various companies have encountered different difficulties in responding to the industry crisis, and the level of losses has also been different. The replacement of executives who are more familiar with the industry is still conducive to boosting performance.
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