Tweet
Japanese newsservice Nikkei reports that Sharp and its new parent Hon Hai (Foxconn) will stop supplying LCD panels for Television sets to Chinese TV maker Hisense. Hisense launched some of its higher-end TVs under the Sharp brand at CES 2016 at the beginning of January this year, as it licensed the name from Sharp for use in the US.
Now displaymakers, according to IHS, are hittng an utilisation rate of 90% on their production lines, due to increased demand for larger TVs and therefor larger LCD panels, it is time to regain some margins.
Last week there was the announcement that the panelmaker would halt supply of TV sized panels to Samsung. Following failed negotiations for higher prices for the Sharp made LCD panels, supplied to Samsung. Making Samsung approach arch rival LG to source TV panels. Samsung being the largest, and Hisense the 4th largest TV maker in the world.
Hon Hai acquired the struggling Japanese electronics conglomerate late last year, and now seems to have established its direction for Sharp. According to Nikkei "Sharp aims to roughly double its Aquos LCD television sales to reach 10 million units worldwide in fiscal 2018. The Japanese company also seeks to buy back its TV brand license in the U.S. from Hisense, based on the direction set by Hon Hai".
Sharp operates the Sakai plant in expensive Japan, while LCD prices have been falling for years, making Japanese TV, LCD Panels, and components manufacturers loss structually loss leading, with many vendors halting production since Pioneer stopped making its renowned but expensive Plasma Televisions back in 2009, followed by its line of Sharp made line of LCD TVS. And even before that Fujitsu. Big Japanese brands like Panasonic and Sony moved to Korean, Taiwanese, and even mainland China panel makers. Panasonic even has Turkish manufacturer Vestel ODM its budget TVs for the European markets. That means Vestel designs and builds a TV and has Panasonic slap its label on it, so now design effort/lead from Japan.
So the new owner of Sharp has decided that there is value in the Sharp brand and production, value it, as is to be expected, is looking to extract. Asking higher prices for panels from external clients and increasing the sales of its own Sharp branded TVs, requiring more panels for group use. According to Nikkei "the moves are part of a Hon Hai-led strategy to boost Sharp's bottom line. The alliance is determined to return Sharp to the black in the year through March 2018".
Now displaymakers, according to IHS, are hittng an utilisation rate of 90% on their production lines, due to increased demand for larger TVs and therefor larger LCD panels, it is time to regain some margins.
Last week there was the announcement that the panelmaker would halt supply of TV sized panels to Samsung. Following failed negotiations for higher prices for the Sharp made LCD panels, supplied to Samsung. Making Samsung approach arch rival LG to source TV panels. Samsung being the largest, and Hisense the 4th largest TV maker in the world.
Hon Hai acquired the struggling Japanese electronics conglomerate late last year, and now seems to have established its direction for Sharp. According to Nikkei "Sharp aims to roughly double its Aquos LCD television sales to reach 10 million units worldwide in fiscal 2018. The Japanese company also seeks to buy back its TV brand license in the U.S. from Hisense, based on the direction set by Hon Hai".
Sharp operates the Sakai plant in expensive Japan, while LCD prices have been falling for years, making Japanese TV, LCD Panels, and components manufacturers loss structually loss leading, with many vendors halting production since Pioneer stopped making its renowned but expensive Plasma Televisions back in 2009, followed by its line of Sharp made line of LCD TVS. And even before that Fujitsu. Big Japanese brands like Panasonic and Sony moved to Korean, Taiwanese, and even mainland China panel makers. Panasonic even has Turkish manufacturer Vestel ODM its budget TVs for the European markets. That means Vestel designs and builds a TV and has Panasonic slap its label on it, so now design effort/lead from Japan.
So the new owner of Sharp has decided that there is value in the Sharp brand and production, value it, as is to be expected, is looking to extract. Asking higher prices for panels from external clients and increasing the sales of its own Sharp branded TVs, requiring more panels for group use. According to Nikkei "the moves are part of a Hon Hai-led strategy to boost Sharp's bottom line. The alliance is determined to return Sharp to the black in the year through March 2018".