Upstream players in the TFT-LCD panel industry are reportedly to start leave-without-pay policies in September as a result of weakened demand from panel makers who are reducing utilization rates, according to sources in the LCD panel industry.
Utilization rates are being reduced despite the peak season, as inventory levels are high amid worse-than-expected demand in the end markets in Europe and North America, the sources noted.
But some panel makers are still optimistic about the fourth quarter. They believe that early promotional sales by channel players for the year-end holiday shopping season and procurement by enterprises will stimulate demand in the fourth quarter, the sources said.
Other panel makers are conservative, saying that panel shipment growth in the fourth quarter will be limited as it takes time for the channel to digest inventories, according to the sources. The uncertain economic conditions may deter consumers from buying.