China is such a prolific electronics exporter that this milestone may come as a surprise: The country is poised, for the first time, to sell more TVs abroad than it does at home in 2007.
That detail comes from iSuppli, the market research firm. The firm says China will export nearly 40 million TVs in 2007, while shipping just over 38 million domestically. The shift comes, in part, because Japanese TV makers such as Sony (SNE) and Matshusita’s (MC) Panasonic are gradually abandoning the business of making traditional CRT televisions in favor of more profitable flat LCD and plasma TVs. Because there is still global demand for CRTs, Chinese manufacturers are picking up the slack.
The report also notes that Chinese companies are finding ways around the fact that it’s difficult to get their TVs into lucrative consumer markets in the United States and Europe. The aim of the Chinese companies, of course, is to get their wares stocked alongside more established brands on the shelves of powerful retailers such as Wal-Mart (WMT), Target (TGT) and Best Buy (BBY).
That goal may be elusive, however. From the report:
Currently, high duty rates and non-tariff barriers are preventing all China-branded televisions from entering high volume markets in Europe and the United States. To circumvent this, China’s TV manufacturers have begun to establish factories in European Union member countries and Latin America in order to avoid having the label of “Made in China,” despite the fact Chinese companies are producing the sets. The ATSC royalties also represent a challenge for Chinese OEMs that want to avoid having to pay an additional fee for each set that is exported to a different country. iSuppli believes that China’s manufacturers have a long way to go before they can successfully sell their products under their own brand names in Europe and the United States.
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