Sony to target 10 mln flat-TV sales in 2007/08
TOKYO, Dec 5 (Reuters) Sony Corp. said it aims to raise global sales of flat-screen televisions by two-thirds in the next business year by focusing on larger sizes and higher-resolution screens to defend against price falls.
Sony will boost flat-TV sales to 10 million in 2007/08, up from its official target of selling 6 million liquid crystal display (LCD) TVs in the current year to March, Takashi Fukuda, senior general manager of Sony's flat TV business group, told Reuters in a recent interview.
LCD is one of the two major types of flat-panel TVs along with plasma displays. Sony has effectively pulled out of the plasma TV market, concentrating on LCD TVs.
''Shipments are growing in the third and fourth quarters, and the end-of-year shopping season is promising good results,'' Fukuda said. ''We will return to profitability in the second half as planned.'' Separately, another Sony executive said on Monday that U.S.
sales of electronics have been better than expected so far this holiday shopping season, fueled in part by strong demand for flat-panel TVs.
If Sony can secure 15 percent of the global market of about 70 million LCD TVs next year, then it will be able to make its sales target, Fukuda said.
U.S. research firm DisplaySearch forecasts global demand for liquid crystal display TVs would hit 71.39 million units in 2007.
In unit terms, Sony held an 11.1 percent share in July-September, trailing rivals Samsung Electronics Co. Ltd., Sharp Corp. and Philips Electronics NV, according to DisplaySearch.
But in terms of revenue, Sony came second after Samsung with a 15.2 percent share of the global LCD TV market.
Despite strong demand as customers snatch up the sleeker flat TVs, overcapacity has triggered steep price falls, squeezing Sony's margins.
Fukuda estimates flat-TV prices have been falling at a rate of 25 to 30 percent a year, and said it was difficult to forecast how much further they would fall.
Sony's strategy is not to cut prices, which would exacerbate price falls, but to add value with bigger TVs with high-definition displays, Fukuda said. Sony also seeks to market its TVs with Sony's other products like high-definition DVD recorders and its video and digital cameras, he said.
''There is a limit to cost cuts,'' Fukuda said. ''When prices fall 20 percent, and if we don't add value to sustain prices, companies can't continue doing business.'' ''It is necessary to create a price range that sustains the Sony brand.'' REUTERS CS DS1156