TV Producers Announcing Big Price Cut

TV Producers Announcing Big Price Cut

China's two largest television producers, Changhong and Konka, have vied with each other reducing prices of their products, adding fuel to a price-slashing war which is enveloping nearly every industrial sector.

On Saturday, China's largest colour television manufacturer Sichuan Changhong Electric Appliance Corporation declared across-the-board price cuts of all its products. On average, the price level of Changhong sets declines by 35 per cent after the reduction.

The action involved all Changhong's products, including more than 50 varieties of its market popular 21-inch, 25-inch, 29-inch and 34-inch television sets. The sharpest price cut for a type hits 3,000 yuan (US$362).

Changhong's price-cutting measure is caused by Konka, China's second televison maker based in Shenzhen, which announced similar price reductions just one day ago.

On Friday, Konka said it would cut selling prices of all its television sets by 20 per cent nationwide in order to lure consumers and increase its market share.

Experts said Changhong and Konka had long been in loggerheads to grab the No 1 position of television maker. While making public its price-slashing measures, a Changhong spokesman said it was not afraid of "price war'' and had the resources to face up to any price actions by its competitors.

The spokesman said its products, after the 30 per cent price cut, are still selling at a price higher than cost, and will continue to earn the company profits.

In the face of China's cut-throat price competition, many foreign TV producers could not wait sitting on the fences and also joined the price war. Phillips Corporation has cut its 29G8 super-flat color TV sets by 500 yuan (US$60), and Sharp Corporation has changed the price of its 29 super-flat color TV sets from 3770 yuan (US$454) to 3380 yuan (US$ 407).

(China Daily)