new lcd display made in china

BOE Technology Group and TCL China Star Optoelectronics Technology (TCL CSOT) are among the Chinese panel makers to have ramped up output since around 2019 with generous state subsidies. China is gaining on South Korea, whose share of capacity is seen reaching 55% for 2022 in an October estimate by U.S. market intelligence firm Display Supply Chain Consultants (DSCC).

The Korean display industry drove Korea’s exports, making Korea a display powerhouse in the world one exporter just 10 years ago. But it has been put into a position to completely lose its power as Korea’s national strategic industry due to a price war initiated by Chinese display makers and a complex global crisis.

LG Display and Samsung Display are struggling to find their ways out of the deterioration of their performance even after withdrawing from production of liquid crystal display (LCD) panels. The high-priced organic light emitting diode (OLED) panel sector regarded as a future growth engine is not growing fast due to the economic downturn. Even in the OLED panel sector, Chinese display makers are within striking distance of Korean display makers, experts say.

On Aug. 30, Display Supply Chain Consultants (DSCC), a market research company, predicted that LCD TV panel prices hit an all-time low in August and that an L-shaped recession will continue in the fourth quarter. According to DSCC, the average price of a 65-inch ultra-high-definition (UHD) panel in August was only US$109, a 62 percent drop from the highest price of US$288 recorded in July in 2021. The average price of a 75-inch UHD panel was only US$218, which was only about half of the highest price of US$410 in July last year. DSCC predicted that the average panel price in the third quarter will fall by 15.7 percent. As Chinese companies’ price war and the effect of stagnation in consumption overlapped, the more LCD panels display makers produce, the more loss they suffer.

As panel prices fell, manufacturers responded by lowering facility utilization rates. DSCC said that the LCD factory utilization rate descended from 87 percent in April to 83 percent in May, 73 percent in June, and 70 percent in July.

Now that the LCD panel business has become no longer lucrative, Korean display makers have shut down their LCD business or shrunk their sizes. In the LCD sector, China has outpaced Korea since 2018. China’s LCD market share reached 50.9 percent in 2021, while that of Korea dropped to 14.4 percent, lower than Taiwan’s 31.6 percent.

Samsung Display already announced its withdrawal from the LCD business in June. Only 10 years have passed since the company was spun off from Samsung Electronics in 2012. LG Display has decided to halt domestic LCD TV panel production until 2023 and reorganize its business structure centering on OLED panels. Its Chinese LCD production line will be gradually converted to produce LCD panels for IT or commercial products. TrendForce predicted that LG Display will stop operating its P7 Plant in the first quarter of next year.

Korean display makers’ waning LCD business led to a situation in which Korea even lost first place in the display industry. Korea with a display market share of 33.2 percent was already overtaken by China with 41.5 percent) in 2021 according to market researcher Omdia and the Korea Display Industry Association. Korea’s market share has never rebounded in for five years since 2017 amid the Korean government’s neglect. Seventeen years have passed since 2004 when Korea overtook Japan to rise to the top of the world in the LCD industry. Korea’s LCD exports amounted to more than US$30 billion in 2014, but fell to US$21.4 billion last year.

A bigger problem is that Korean display makers may lose its leadership in the OLED panel sector although it is still standing at the top spot. While Korea’s OLED market share fell from 98.1 percent in 2016 to 82.8 percent last year, that of China rose from 1.1 percent to 16.6 percent. Considering that the high-end TV market is highly likely to shrink for the time being due to a full-fledged global consumption contraction, some analysts say that the technology gap between Korea and China can be sharply narrowed through this looming TV market slump. According to industry sources, the Chinese government is now focusing on giving subsidies to the development of OLED panel technology rather LCD technology. On the other hand, in Korea, displays were also wiped out from national strategic technology industry items under the Restriction of Special Taxation Act which can receive tax benefits for R&D activities on displays.

Introduction: Global LCD industry shift and automotive intelligence together to promote the rapid development of China’s LCD panel industry, which will bring a continuous increase in demand for backlight modules, China’s backlight module industry has greater potential for development.

LCD panel backlight module consists of a backlight light source, light guide, optical film, and a plastic frame, which is an important component of LCD display panel. As the backlight module has technology-intensive and labor-intensive attributes, with abundant high-skilled labor advantage China is attracting the global LCD panel industry to the domestic rapid transfer.

From LCD application to the present, the global LCD panel industry capacity transfer has gone through three periods, 2000 Japan dominated the global LCD industry; 2000 – 2010, Japan’s production capacity to South Korea and Taiwan; 2010 to the present, Japanese manufacturers gradually withdraw from the LCD panel industry, production capacity began to transfer to mainland China, so far, mainland China LCD production capacity has occupied the global half of the world.

In recent years, South Korea’s Samsung and LG display will shift their business focus to OLED, and will gradually shut down their LCD production lines and withdraw from the LCD panel industry; at the time of South Korean manufacturers’ withdrawal, domestic enterprises are stepping up new construction to expand LCD production capacity.

BOE, Huaxing photoelectric, Huike, CEC in 2020 – 2021, a total of eight 7 generation LCD production lines completed and put into operation, and domestic panel manufacturers have further expansion plans, the next few years domestic LCD production capacity will continue to increase.

LCD panel manufacturers tend to choose the nearby supporting module suppliers for the safety of the key component supply chain and cost reduction considerations. LCD panel production capacity transfer to China will bring opportunities to domestic backlight module manufacturers and drive the development of the domestic backlight module industry.

The future of the car will pay more attention to the human driving experience, to the intelligent development, which will bring the increasing demand for car display. On the one hand, the number of car displays gradually increased, for example, the instrument panel, rearview mirror, central control platform more to display the way, the passenger and rear position with entertainment display. On the other hand, the car display is constantly to a large screen, multi-screen development, especially in high-end models, the large display has become standard, for example, Tesla Model S screen size of 17 inches, Mercedes-Benz A-class car configuration of two 10.5-inch display.

At the same time, there is also a huge demand for new cars in China. Although China’s car sales have reached 25 million, the current per capita car ownership in China is only a quarter of the developed countries, the future potential for new car demand is still very large. Therefore, China’s car display market growth potential is large, which will directly drive the domestic backlight module demand continues to increase.

According to the terminal application size, backlight module can be divided into large, medium, and small size, of which small size backlight module is mainly used in smartphones, wearable devices, and other terminals, the medium size used in notebook computers, tablet PCs, car screens and other terminals, the large size is mainly used in LCD TV.

From the market competition pattern, the domestic backlight module enterprises are deeply plowed in their respective competitive advantage in the field of segmentation, including Baoming technology, Longli technology mainly layout small size cell phone display field, Hanbo high-tech, Weishi electronics mainly layout in the size of car display and notebook computer field, Rui Yi photoelectric and photoelectric in each field have layout.

From the industry development trend, smartphone display is transitioning to OLED, LCD TV market is gradually saturated, the future of large size and small size backlight module market potential is relatively small; and the future of the car display market potential is huge, by the backlight module manufacturers are unanimously optimistic, are currently accelerating the layout ( see Table 2 ). Focusing on the traditional medium-sized backlight module field, Hanbo Hi-Tech and Weishi Electronics have significant advantages in core technology patents, downstream customer resources, process experience accumulation, production costs, etc., and have more development advantages in the future.

The current global LCD display panel industry is rapidly moving to China, which brings development opportunities to China’s backlight module industry. In addition, automotive intelligence will also bring a continuous increase in demand for medium-sized car displays, the first to enter the field of medium-sized backlight module manufacturers with its customer resources, core technology, scale efficiency, and other advantages will be more beneficial.

(Yicai Global) June 13 -- BOE Technology Group, TCL China Star Optoelectronics Technology and other big Chinese liquid crystal display manufacturers are reducing output starting from this month to try and stop a freefall in prices caused by a global glut.

LCD TV display shipments from China’s five largest panel manufacturers accounted for 68.5 percent of the global market in April, a new high, and they were expected to exceed 70 percent this year, according to Omdia.

The price of small and medium-sized TV displays has more than halved since the highest point last year, and that of large-sized screens have fallen by more than 40 percent, according to AVC Revo.

“Panel makers are facing rising liquidity pressure and bigger losses as prices are now below cost price, so the display industry is likely to undergo another big reshuffle,” Rong said.

Here was their conundrum: Could miniscule electrical jolts unwind the spiral molecular structure of a new substance known as “liquid crystal,” causing the crystals to block light, then re-twist them and allow light to pass through again?

They filed a Swiss patent for the idea on Dec. 4, 1970. Though it attracted scant attention at the time, the milestone now stands as the birthdate of the liquid crystal display (LCD) – the technological platform which has transformed consumer electronics and presented a brilliant new way to view the world.

Early LCD developers took a few years to figure out that specialty glass, not plastic, was the best stable substrate for the delicate LCD circuitry and the color backplane component. Once they did, they turned increasingly to Corning to supply them with extraordinarily stable, flat, fusion-formed glass, able to preserve the critical properties of the liquid crystal and withstand high processing temperatures.

And LCDs rapidly transformed from “passive matrix” models, mostly used in pocket calculators and digital watches, to “active matrix” LCDs in which each sub-pixel was controlled with an isolated thin-film transistor. AMLCDs enabled wide viewing angles; brilliant, fast-moving images; and high-resolution images that had never been possible before.

Corning Incorporated was a critical player in this development, and eventually became the world’s leading supplier of LCD glass substrates. And Corning® EAGLE XG® Glass, the world’s first LCD substrate with no arsenic or other heavy metals, went on to exceed sales of 25 billion square feet, making it one of the most successful products in Corning’s history.

It appears too soon to say that Samsung Display and LG Display, the nation’s top display makers, will exit from the less lucrative LCD market amid a cutthroat competition with Chinese rivals with cheaper pricing.

Until a few years ago, the two firms had hinted at retiring from the old-school LCD business to focus on more advanced technologies such as upgraded LCDs or OLEDs to widen the gap with Chinese runner-ups.

But experts here say there has been a sign of change in the attitudes more recently, pointing out that their full shutdown of LCD operations ultimately would hinge on elevating profitability of their high-end push.

In 2020 alone, Samsung Display posted a deficit of more than 1 trillion won ($841.5 million) in its LCD business. But it has no other option but to continue production to meet the demand from its parent Samsung Electronics, the world’s largest TV maker.

The firm last year sold its LCD production facility in China to its Chinese rival TCL China Star Optoelectronics Technology, a key supplier to Samsung TVs. But the LCD line in Suzhou, China recently cut its panel supply almost in half, with Samsung’s display unit highly likely to be tasked with filling the void.

“(Samsung Electronics) have few choices but to contract with Samsung Display to make up for its LCD TV set capacity,” said Yi Choong-hoon, chief analyst at UBI Research.

This put Samsung Display‘s full exit plan in disarray. After the sell-off of the Chinese facility, the firm is also scaling down its LCD plant in Asan, South Chungcheong Province, to convert part of the facilities to its quantum-dot OLED lines to supply to set makers including Japanese firm Sony.

LG Display’s LCD business -- with production lines in Paju, Gyeonggi Province and Guangzhou, China -- is poised to generate 2.5 trillion won in operating profit for 2021, up fourfold from the previous year, according to Kim Jung-hwan, an analyst at Korea Investment & Securities, on Thursday.

This comes in sharp contrast with OLED TV earnings estimate. According to Kim, LG Display‘s OLED TV operations will post 152 billion won in operating loss, as its fourth-quarter forecast to generate 62 billion won income was dwarfed by 214 billion won losses for the previous three quarters. Since inception, LG’s OLED panel business has been in the red due to heavy spending.

“A bigger penetration of OLED TVs to consumers is a prerequisitie for a conversion of (LG Display’s) existing LCD TV lines to OLED TV lines,” he said.

Analysts also said LG Display has already streamlined its LCD TV lines under a series of restructuring of LCD TV lines, including a conversion to lines for IT devices including mobile phones.

“(LG Display‘s) LCD TV fabs with low profit margin have completed a retreat in the first half of 2021,” said Kim Sun-woo of Meritz Securities. “LG is now capable of maintaining LCD capacity with a decent profit margin.”

This comes against the backdrop of industry projections that LCD TV panel prices continue to fall steadily over the course of the first quarter, and Chinese rivals are forecast to ramp up dominance in LCD market,

According to US-based market intelligence firm Display Supply Chain Consultants, Chinese firms’ LCD market share on a capacity basis are forecast to rise to 71 percent by 2025, from 53 percent in 2020, far outpacing Korea, Japan and Taiwan, as of June 2020.

Another estimate, released earlier this week, showed the price for LCD TV panels regardless of size -- ranging from 32- to 65-inch -- is projected to fall until March, giving up almost entire gains from July 2020 to July 2021 that is partly attributable to announced exits of Korean LCD panel makers.

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