In 2009, sales of all types of TVs in North America are predicted to decline by 4 percent
Sales of flat panel TVs are going flat.
In a reversal of fortune, television sales in the United States are predicted to drop in 2009, according to a new report from DisplaySearch, a market research firm. It would be the first sales decline in at least a decade, said DisplaySearch, and the first decline in revenue since 2000.
TV makers have long argued that TVs were recession-proof because Americans would continue to buy them as a cheap way to entertain their families. But consumers are now starting to shun the LCD and plasma sets, even as prices fall sharply.
In 2009, sales of all types of TVs in North America are predicted to decline by 4 percent. LCD TV sales are expected to increase in North America by 2 percent over 2008, a fraction of the 22 percent gain in 2008 and the 77 percent rise in 2007.
“There was an unnaturally high growth in sales due to the transition to digital TV and the replacement of picture tube TVs,” said Paul Semenza, a senior vice president at DisplaySearch. “You would expect a reversion to the mean, but this is beyond that.”
Mr. Semenza began to notice a rapid drop in production from August to November. By the fall, flat-panel manufacturers in Taiwan that supply to various brands began to cut back production as name brand manufacturers needed panels only from their own facilities.
The flat-panel factories are now running at 80 percent capacity, down from the 90 percent rate of just a few months earlier. A similar shift is now happening in Korea, Mr. Semenza said.
Worldwide, LCD shipments will continue to grow about 17 percent in 2009, the market researchers predict, but almost all of that growth will come from emerging markets, where few own flat-panel sets.
LCD revenue will drop by 16 percent, while revenue from all types of TVs will fall by 18 percent. In North America, revenue will decline by 24 percent.
None of this is good news for consumers. Mr. Semenza expects that prices for LCD sets 32 inches and smaller will remain fairly stable. Retail prices on TVs 42 inches and larger will not decline as fast as they have in years past.
Some makers of the flat panels for big-screen TVs are delaying the construction of factories that produce panels more efficiently and that allow them to undercut competitors with lower prices.
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