The global TV market continues to transition from CRT to flat panel units, affecting greatly the manufacturing industry in China, where the majority of the world's TV sets are sourced. While there are manufacturers resisting the threat of flat screen domination, other companies have turned their production and R&D focus on new display technologies.
In China, the central government has implemented initiatives to encourage people to replace the former with new flat panel TVs. Data from the Ministry of Industry and Information Technology shows the country produced 13 million CRT TVs in 1H09, down 42 percent year-on-year. Exports for the period also fell by 46 percent to 5 million units.
Many tier 1 makers are aligning their supply chain to accommodate FPD production. For instance, Skyworth plans to quit the CRT business by the end of next year. Hisense, meanwhile, has stopped selling CRT TVs in urban areas. The two suppliers' local CRT market encompasses mainly orders from the countryside, while exports depend largely on the volume of orders from overseas.
Despite the rapidly falling demand for CRT models, other suppliers are not as quick to quit production.
According to interviewed maker Konka Group Co. Ltd, the CRT TV line is still important in rural areas and export markets. The line is regarded as entry-level in the Middle East, Africa, Latin America and India. Sales are already showing signs of a rebound after the first two quarters of 2009.
With the market shrinking as more suppliers quit the line, makers planning to continue CRT production stand to benefit. Jin Pin Electrical Co. Ltd's factories have been running at full capacity since June. It has been consistently among the top three exporters of the line, according to customs statistics.
The central government raised the export tax rebate for CRT models to 17 percent starting April, boosting shipments in the sector further.
China suppliers offer CRT TVs with display sizes below 29in to avoid direct competition with flat panel TVs. Units 21in and below are mainstream, usually serving to supplement larger-sized FPD models in the market.
Products with the traditional, bulky thickness make up the basic line. These provide a fewer number of connection interfaces and functions, although some with a built-in mono speaker are available at a lower price point. Units are $8 to $10 less expensive than slim or ultra-slim models of the same display size.
Konka's CRT product strategy is to provide small, simplified models at low quotes. At Jin Pin, production has stopped for CRTs above 29in.
|Ultraslim form factors|
Besides their low-end orientation, slim, ultra-slim and pure flat CRT models are popular for being similar in appearance to the flat panel TV form factor.
The latest ultra-slim sets are close to 30cm thick. Although more expensive than units with normal thickness, the slim model is priced 50 percent lower than a flat panel TV with the same display size. These sets occupy a part of the FPD market and help extend the appeal of the CRT line. Nearly all China suppliers' CRT series are available in slim or ultra-slim designs.
Jin Pin's new series of CRT TVs are based on the slim mold design as well, meeting the latest aesthetic requirements. Slim and ultra-slim units take 30 to 40 percent of its total output.
Entry-level sets below 21in provide SECAM, NTSC, PAL optional system and basic functions such as mono speakers, 200 and above preset channels and auto search.
Enhanced models with 21 to 29in displays have stereo speakers, an S-Video input, Y/Cb/Cr input, a SCART port, teletext, auto white balance and NICAM. As a mature product line, R&D focus is on form factors and external designs. The major components are the tube and the IC solution. China suppliers usually source tubes from Samsung, LG, Irico and Matsushita, while chipsets come from Sanyo, Toshiba and Philips.
Leading CRT suppliers have been cutting down or stopping output as a result of recession in the line. This has put color CRTs in tight supply, raising costs overall. Some makers have increased prices slightly to counteract lost profits, although most interviewed companies expect a brighter outlook in the coming months.
More than 50 percent of the world's CRT TV sets are made in China, where exports take about half of total output. There are an estimated 50 suppliers in the country.
After half a century's development, China has formed a mature CRT TV industry chain, from upstream component manufacture to finishing the sets. The country's major TV suppliers started with CRT TV production. And with more of these tier 1 makers putting their R&D focus on flatscreen manufacture, midsize suppliers are taking the opportunity to raise their share of business.
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