Chi Mei Optoelectronics (CMO) has decided to throttle down LCD panel production by 10%, effective immediately. CMO’s original plan was to wait until August to make a decision regarding LCD production. CMO has already decreased LCD module production by 10%. This is in response to inventory build up of LCDs and LCD-based products such as LCD TVs and LCD monitors in the display supply chain.
IT customers have significantly reduced orders in July and at the same time LCD monitor panel prices have spiraled downward. Lowering LCD panel production by the second largest Taiwan-based LCD manufacturer will not have a major impact in the overall supply and demand situation, but will be a significant signal for others participating in the LCD supply chain. The overall utilization rate was reported by DigiTimes to be 90% after the 10% reduction. This is impossible as utilization rates are never at 100%. Most likely, CMO’s realistic utilization after the 10% decrease would be around 80% to 83% is my guess.
[tags]Chi Mei Optoelectronics, CMO, Display Manufacturer, LCD Manufacturer, LCD Monitor, LCD TV, Notebook PC[/tags]