Many Chinese LCD TV manufacturers are brewing another round of markdown in the local market, involving the most brands and sizes ever in 2008, according to Fan Zhijun, vice president of Suning Appliance Co., Ltd. (SZSE: 002024), one of the two biggest home appliance retailers in China.

He disclosed that the prices of TCL and Changhong 32-inch LCD TVs would be below CNY 3,000 per set after discounts, Changhong 42-inch full high-definition (HD) LCD TVs less than CNY 5,000, Skyworth 47-inch full HD LCD TVs beneath 7,000, and Skyworth, TCL, Hisense and Konka full HD LCD TVs under 10,000.

The information was testified by a marketing executive of Hisense Electric Co., Ltd., one of the manufacturers, who said that all the Hisense marketing arms around the country have received the headquarters' notice of markdown, at which, every Hisense 52-inch 1080P full HD LCD TV will be sold at CNY 9,999, and some 32-inch LCD TVs at CNY 2,999.

Such prices generate little profits, but are expected to help snatch a larger share of the market, according to Mr. Fang, who added that his company did not have to achieve profit from every product, as long as its overall products were profitable.

Besides, an executive of TCL Multimedia Technology Holdings Limited (SEHK: 1070) affirmed that the price of TCL LCD TVs has decreased to CNY 9,999. And discounts are also applied on most other TCL LCD TVs, with a maximum margin of 30%.

He added that foreign LCD TV manufacturers have been weakening their advantages in the Chinese market, due to oversupply of LCD panels, whose high prices have brought huge profits from their Chinese peers formerly.

On the other hand, the oversupply caused a price decrease in such panels, and so enlarged the space for domestic competitors to press the prices of their terminal products. In addition, he deems that the upcoming markdown will be based on the improved technology, distribution network and services.

However, another executive of Suning Appliance disclosed that the blowing financial storm has squeezed the overseas demand for Chinese-branded LCD TVs, and as a consequence, many local producers witnessed large storages due to the decline in overseas orders for the period around the Christmas. And the markdown is defined as a move to recover capital.

The opinion was partly agreed by TCL Multimedia Technology, which said in its third-quarter financial statements that the uncertainties from the global financial market would impose effects on its business achievements, including an distinct decrease in overseas sales.

Source:SinoCast