London, UK – Display Panel Manufacturers Brace for Lower Utilization Rates in Q2
In the dynamic world of technology, the production landscape for display panels is undergoing a shift. According to a recent report by Omdia’s Large Area Display Production Strategy Tracker, the first quarter of 2025 (1Q25) saw display panel makers maintain a fab utilization rate above 80%. However, this trend is expected to change in the second quarter of 2025 (2Q25), with manufacturers adopting a more conservative approach to panel purchases.
Factors Contributing to the Change
The pull-in demand for 1Q25 is winding down at the beginning of 2Q25. This is a common occurrence in the tech industry, where demand for new products spikes during the holiday season and then tapers off in the following quarter. Additionally, uncertainty surrounding the new U.S. tariffs on display application products, including TVs, PCs, and smartphones, is causing manufacturers to be cautious in their panel purchases.
Impact on Consumers
For consumers, the reduction in display panel utilization rates could potentially lead to supply shortages and price increases for products such as computers, smartphones, and televisions. As panel manufacturers reduce their production, there may be fewer panels available for device manufacturers to use in their products. This could result in longer lead times for new devices or even price increases to offset the cost of the more expensive panels.
- Consumers may experience longer lead times for new devices
- Price increases for devices due to more expensive panels
Impact on the World
On a larger scale, the reduction in display panel utilization rates could have ripple effects throughout the global tech industry. Supply chain disruptions and price increases for components used in devices could impact the production of other tech products, leading to potential delays and increased costs for manufacturers. Additionally, the reduction in panel production could impact jobs in the tech industry, particularly in areas where panel manufacturing is a significant employer.
- Ripple effects throughout the global tech industry
- Potential job losses in panel manufacturing
Conclusion
The reduction in display panel utilization rates in 2Q25 is a trend to watch for in the tech industry. While it may lead to supply shortages and price increases for consumers in the short term, it could also have larger implications for the global tech industry and the jobs it provides. As the industry continues to evolve, it will be important for manufacturers, consumers, and policymakers to stay informed about these trends and adapt accordingly.
