Gross margins for the production of TVs by Taiwan-based ODMs are expected to remain low in 2012 as branded TV vendors will continue to press down ODM production costs due to increasing market competition although they may increase their order volumes, according to industry sources.

Buoyed by increasing popularity of LED-backlit models and demand for 3D and smart TVs, global TV shipments are expected to reach 220 million units in 2012, the sources estimated.

Japan-based branded vendors including Sony, Panasonic and Toshiba are expected to release more orders to Taiwan-based ODMs due to the appreciation of the Japanese yen and increasing competition, the sources noted.

Taiwan-based ODMs including TPV Technology, Foxconn Electronics, BriView Electronics, Wistron and Compal Electronics are expected to land the windfall orders. But Japan-based vendors are also expected to bargain for more competitive ODM costs after most of them incurred heavy losses in 2011, the sources commented.