Fun with Data – 2020 - Supply Chain Market Research

Fun with Data – 2020

1/18/2021

a-nom-a-ly – Something that deviates from what is standard, normal, or expected[1]. Based on that definition 2020 was certainly an anomaly for many industries, with some seeing significant issues while others seeing unusual benefits. The CE space, on a general basis, was one area that saw benefits, with the COVID-19 virus forcing much f the global population to remain sequestered for extended periods, and moving the workplace from offices to homes. This lifestyle change had a profound effect on the display space, which is the ‘front-end’ of almost all consumer CE devices. Rather than use the word ‘unprecedented’, one severely overused last year, as part of our supply/demand modeling, we mapped out some detail on what 2020 really looked like in the display space.
The simplest comparison van be made looking at large panel display shipments, which include any display above 9", which leaves out smartphones, but includes tablet, notebooks, monitors, and TV panels. Looking back to 2013, the greatest y/y change large panel shipments had seen was in 2018, when the industry saw a massive 7.1% increase in total large panel shipment. That said, 2020 saw twice that amount at 14.5% y/y, with only TV panel unit volume declining y/y. The table below breaks down each segment in 2020.

[1] Oxford Languages – Oxford University Press

Large Panel Shipments & ROC - Source: SCMR LLC, IHS

Drilling down further to the quarterly level, one can see that the year was extremely compressed into the last three quarters, with little growth in 1Q, due both to seasonality and to the onset of the COVID-19 travel restrictions that limited production, with only TV panel shipments seeing all four quarters falling below ROC averages. The charts below indicate both 2020 shipments in each category and how they compare to the 5 year averages (2015 – 2019 in red) and in absolute shipments in the data set Fig. 6 – Fig. 9. If we compare the absolute shipment totals against 5 year averages, the table looks like this:

The tables show that other than TV panels, each category grew substantially, however a portion of that growth would have to be attributed to what would be ‘normal’ yearly growth for each category, however if we compare shipments in 2015 to shipments in 2019 we can see the inherent growth rates are not always positive.

Based on the table data above, in 2020, Notebooks and Monitor panels grew against negative 5 year shipment growth rates so we included a column for 3 year growth rates to give some perspective and smooth yearly variations. Against the 3 year averages Notebook panel shipments grew almost 4x times the averages while Monitor panel shipments grew over 6.5x the 3 year averages. TV panel shipments were the opposite, falling against both 5 year and 3 year averages, while tablets grew an astounding 8.8x against the 5 year averages and 8.6x against the 3 year averages. Total panel shipments grew 3.2x and 2.3x against the 5 year and 3 year averages respectfully.
So if we go back to the top of this note, 2020 was an anomaly, but where does that leave us as we head into 2021? Do we have a snap-back to ‘normal’, or is 2020 the ‘new normal’? That is not something we will cover in this note, as it is a summary of 2020 rather than a look into 2021 and beyond, however, given that the COVID-19 pandemic was the likely cause of the break from what might be called normal, much will depend on what happens to the infection rate and its impact on both global, regional, and country-wide economics and consumer psychology.
Based on the above, our inclination would be to expect a return to more normal growth in each category, although the possibility of 2020 having ‘borrowed’ considerable growth from 2021 is certainly a possibility. Therefore, in weeks following, we will present a number of scenarios that make assumptions about COVID-19 and its economic impact this year, and match those scenarios against capacity scenarios. In the case of capacity, the effects of COVID-19 would have a lesser effect, but one that has already changed the capacity outlook for this year, with Samsung Display (pvt) and LG Display (LPL) postponing plans to reduce or eliminate much of their large panel LCD production. The above is the tip of the iceberg.