Deep Discounts Fail to Stem LCD Panel Supply Glut

Liquid crystal display panel inventory is still higher than demand for the panels, despite deep discounting in stores, write the research folks at Avian Securities this morning. Based on “ad-hoc checks,” the report observers, while heavily discounted items are being sold, overall inventory is still above demand.” The report notes that there are rumors of mergers being encouraged by the Taiwanese government between LCD panel makers AU Optronics ( AUO ) and Chi Mei Optoelectronics ( CMOPF.PK ), but opines that “We find little to be excited about unless such a combination reduced capacity going forward. Both producers are already able to take advantage of economies of scale, so a combination will do little to change that situation.” ”As I noted last week, AU and Chi Mei and other panel makers continue to crank out product even with their factories running at a drastically reduced rate of capacity. AU Optronics shares today are down 14 cents, or 2%, at $6.74. Shares of Corning ( GLW ), which provides ... (link)