China’s TV market not easy prey for Korean firms

HONG KONG - Samsung Electronics and other foreign television makers are struggling in China, the world’s largest TV market, due to stiff competition from local rivals, a report said yesterday.

Six global TV makers - Samsung, LG Electronics, Sharp, Sony, Panasonic and Toshiba - only made up 15.7 percent in the second quarter of 2012, Bank of America Merrill Lynch said in a report. The figure was down from 29.8 percent for full 2008.

Sony held the largest share among the foreign makers with some 4 percent, followed by Samsung Electronics and Sharp, both of which were estimated to have shares of around 3.5 percent.

LG Electronics and Toshiba were the smallest TV sellers in the country with each posting stakes of less than 2 percent.

Bank of America Merrill Lynch said global players have seen their LCD TV shipments to China edge down in recent years.

Their slowdown was attributed to local Chinese brands like TCL and Skyworth Group that dominate in smaller Chinese cities where major chain stores cannot penetrate effectively due to the existence of distribution channels such as mom-and-pop stores.

“Samsung Electronics and LG Electronics are the top two TV brands in the world with a combined global market share of 34 percent in the second quarter of 2012. However, they seem to have a hard time replicating that success in China, where Chinese players generally win on channel strategies and price competition,” said Robin Cheng, an analyst at Bank of America Merrill Lynch.

Meanwhile, Japanese TV brands such as Sharp and Sony have been scaling back their TV operations to prioritize profits instead of production size, Cheng said.

China is now the world’s most important TV market and is expected to account for 24 percent of global shipments in 2012.

Yonhap