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Declining demand may lead to layoffs, say TV manufacturers

"The demand for LED TV is going down because prices are increasing and if the government will not intervene right now, I think it will be very difficult for existing small TV manufacturing companies to survive," said Avneet Singh Marwah, Director and CEO, Super Plastronics

twitter-logoNidhi Singal | March 17, 2021 | Updated 19:00 IST
Declining demand may lead to layoffs, say TV manufacturers 
Input cost has increased TV price by 40% in 32 inch variants

Government's initiatives to fuel growth in local television manufacturing in India is posing challenges for home-grown manufacturers. The rising input cost has resulted in about a 40 per cent price hike in 32 inch and 40 inch LED TVs as compared to last year, resulting in a about 20 per cent downfall in terms of the demand for televisions.

"The demand for LED TV is going down because prices are increasing and if the government will not intervene right now, I think it will be very difficult for existing small TV manufacturing companies to survive. Due to this, the industry might see a lot of layoffs," explains Avneet Singh Marwah, Director and CEO, Super Plastronics Pvt Ltd.

To support its mission of Aatmanirbhar Bharat to boost local manufacturing, the government of India had imposed restrictions by changing the import policy for colour televisions from "free" to "restricted" in July last year. The government had also imposed a 5 per cent customs duty on the import of open-cell for televisions, which has also impacted the pricing significantly. Besides, the rising raw material cost isn't helping manufacturers either. "Raw material prices have increased by 350 per cent over the last year. There is additional pressure as the bill of material costs for manufacturing TVs are increasing rapidly. The government needs to give some pushback and there should be some sentiment and movement in the manufacturing sector," says Marwah. Local TV manufacturers are requesting the government to include LED televisions in its production linked incentive scheme as this 4-6 per cent incentive will help them balance the high input cost.

Currently, instead of manufacturing, TVs are being assembled in India. The biggest component - Open-cell panel amounts to 70 per cent of the cost. And as all the top electronic component manufacturers including BOE, Inolex, TCL CSOT have their plants in China, the panels are imported in the country. "The current technologies are a decade old and nobody wants to invest because the investment for the panel is huge - about $2 billion. If the PLI scheme in televisions is introduced in time, it can attract players to invest in the latest technology, which  I think will benefit the Indian manufacturers in the long run," adds Marwah.

Noida headquartered Super Plastronics Pvt Ltd. is the official brand licensee and manufacturer of Kodak TVs in India and has three manufacturing plants in Noida, Una and Jammu. The company has already invested Rs 500 crore in a new manufacturing facility in Hapur, UP which will be operational by 2022. The company is putting in an additional Rs 300 crore for an R&D centre at the same plant that will focus on the development of IoT technologies.

Also read: Indian TV makers await PLI scheme, say important for global competition

Also read: LED TV prices set to rise from April; manufacturers say market dominated by Chinese

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