As for displays, "small is the answer." Competition in small displays intensifies
As the TV market is in recession, the display industry is quickly reshuffled with focus on small products. Shipments of smartphones and smartpads are continuously increasing, and small products are more profitable than large products like TVs.
According to an industry insider on September 10, domestic and overseas display manufacturers are quickly adjusting their production capacity to seize the high-value-added small display market.
Until last year, their common goal was to increase their share of the TV market. As Chinese companies began to fully operate the 8.5G (2200㎜×2500㎜) lines and encroached on the local TV market, Korean and Taiwanese manufacturers responded to it by finding new sizes. However, starting this year, small displays for smartphones and smartpads emerged as the center of the market. The direction of investment was also changed depending on the sales structure of small panels.
Having started to change some lines into low-temperature polysilicon (LTPS) processes starting last year, LG Display recently decided to invest in changeover again. LTPS is a process necessary for producing high-resolution displays for mobile devices. As the production capacity of AP2, the only LTPS line in the Paju plant, reached a limit, LG Display began to invest in the changeover last year. The company decided to make additional investments in changeover to start applying the LTPS process to smartpads next year.
The future of Samsung Display’s investment in a new AMOLED plant (A3) is changing depending on the demands for mobile displays. The company decided to hurry its new investments as the display area of smartphones was getting bigger and their demands were increasing in the first half. As the demands for the displays for smartphones were looking down afterwards, Samsung Display postponed investments to apply the new technology.
China’s BOE, which became No. 1 in the small display market in terms of quantity, is planning to greatly increase its small display production capacity as it starts operating new lines. The LCD for TVs was the driving force behind the growth of BOE, but it believed that value added would come from small displays. If Hefei starts to operate the new 8.5G (2200㎜×2500㎜) line next year, all existing 5G and 6G lines will be changed into lines for small displays. All the panels for monitors and TVs, which used to be produced on 5G and 6G lines, will be produced on 8.5G lines. The 6G lines are already switched into lines with focus on products for smartphones and smartpad. BOE is known to produce small touch panels here as well.
As the sales of small displays stagnated, Taiwan’s AUO and Innolux began to introduce the all-in-one touch display as a new growth engine. “The smartphone display market is already bigger than the TV display market,” said an industry official. “As we are competing to dominate this market, the supply chain is also changing rapidly.”
Moon Bo-gyeong | okmun@etnews.com
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