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  • PC Monitor Production Value Falls 12.6 Pct. in Q1
  • May 6, 1998 (TAIPEI) -- Taiwan's personal computer monitor industry, which holds the largest share of the global market, experienced its first decline in production value in the first quarter of this year.
    The Market Intelligence Center (MIC) of the Institute for Information Industry released statistics showing that the production value of the industry declined 12.6 percent in the first quarter due to the sharp plunge of cathode-ray tube (CRT) prices and the low-cost trend on the PC market.

    MIC analyst T.P. Wang points out that rising inventories among U.S. PC makers and distributors prompted a wave of price-slashing on the U.S. market last year. Some companies even chose to exclude monitors from their sales packages, in order to reduce prices even more, and thus attract more customers. As a result, local OEM manufacturers saw orders drop, and deliveries during the first quarter increased by only 12.4 percent from the same period last year.

    In addition, an oversupply of CRT tubes pushed prices of these products down, which in turn led to lower monitor prices, and subsequently, lower profits for manufacturers. Monitor prices in the first quarter dropped by an average of 22.3 percent from the same period last year, which was the major cause behind the 12.6 percent drop in production value.

    Wang estimates that shipments of the local monitor industry are likely to grow by only 12.2 percent in the first half of this year. Total sales are expected to increase by 14.8 percent for all of 1998. The 15-in. monitors will remain the mainstream products of the market, while 17-in. models are likely to garner a 30 percent share.

    Still, Lite-on Technology general manager Wen Sheng-tai said prices of PC monitors should hit bottom soon, as CRT producers have begun to decrease production to stimulate a price rebound. Demand for PC monitors, he added, should also recover along with the rebound of CRT prices in the second half of the year.

    Faced with falling profits, local manufacturers have swiftly shifted orders to overseas plants, in order to reduce production costs. Currently, the output of their overseas plants accounts for 62 percent of the total, up from 52 percent a year ago.

    Y.K. Huang, a manager at Acer Peripherals Inc., said demand for speedy delivery from multinational clients was another factor that prompted local manufacturers to resort to their global logistic systems. Yet, controlling inventory at their overseas outlets has presented a tough challenge for these firms. Huang suggested that the development of self-owned brand names will be helpful in alleviating this problem.

    GVC Corp. manager Tyson Luo has a different view on this issue. Luo pointed out that the competition between famous multinational PC makers is already too keen to allow the survival of new market participants. If local manufacturers should resort to the development of new brand-name products, China and third-world countries will be better target markets, he said.

    (Commercial Times, Taiwan)

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    Updated: Tue May 5 21:10:19 1998