According to Displaybank, prices for 32 inch panels could fall below $300 to $290 dollars in the third quarter of 2007. 40 inch panels are also predicted to see a steep drop in price with prices going down to $500 in Q3 of ‘07. With prices dropping rapidly, many second tier panel manufacturers will see losses as opposed to profits during 2007.

Case in point. 32 inch panels dropped 37 percent from $572 dollars a year ago to $360 dollars now. Profits associated to these 32 inch panels dropped from $22 dollars a year ago to $5 dollars now.If the average selling price for 32 inch panels falls to $290, then panel manufacturers will be selling for a loss which of course means trouble for these manufacturers.

Currrently, 40 inch panels cost around $690 dollars – down from $1027 a year ago. However, profits from these 40 inch panels actually went up during 2006 since material costs went down during the year. However, Displaybank thinks this won’t hold true for 2007 as falling prices will again squeeze profit margins.

Of course this is great news for consumers at this point but it does mean many 2nd and 3rd tier companies will probably fall by the wayside in the coming year. The only companies who could weather the falling prices would be large corporations with diverse product selections or companies that come up with cheaper manufacturing costs (which seem unlikely given that labor costs are already maximized in many instances).

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