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The second half of 2018 just started, Chinese OLED panel makers are chasing Korea. Where are they?

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작성자: 오하나 (Analyst, hanaoh@ubiresearch.com)
The display industry has been in a state of confusion by the recent leaking of OLED display panel production technology into China.

As of 2018, five companies (BOE, Everdisplay, Tianma, Truly, and Visionox) have OLED production lines in China, among which only BOE has a line that can produce OLED displays (“Plastic OLED”) using plastic substrates, applied to the premium smart phones such as Samsung Galaxy and Apple’s iPhone. Other panel makers are building lines to produce plastic OLED displays targeting mass production this year and next year.

Monthly production capacity planned by Chinese panel makers by the end of 2020 is about 250K, which is more than the monthly production capacity of Samsung Display (about 180K). If China produces a similar level of panels through mass production, it is clear that Korea cannot defeat China in terms of production costs. The main application of the 6G plastic OLED display is a smart phone; however, the global Smartphone market has slowed down since 2015, especially in the premium Smartphone market, there seem no new markets. If mass applications such as smartphones are not developed, panel makers that do not have cost competitiveness will be hard to survive due to a large oversupply in the near-term and falling panel prices.

Korea is evaluated to have a considerable technical advantage since the production of plastic OLED displays requires a high level of technology and process know-how for the time. However, the industry expects that Chinese government’s support for the panel makers with the background of capital as part of the “China Manufacturing 2025” strategy, will shorten the technology gap quickly.

Chinese panel makers ahead of their mass production by 2019 are also reported to be more aggressively scouting Korea’s major OLED engineers. There are about 100 Korean OLED engineers in Chengdu (B7) plant that produces plastic OLED display of BOE. GVO is also known to have recently hired some important OLED engineers with high salaries. CSOT, which has been known to suffer difficulties from the initial research stage, seems to be expediting the construction of mobile OLED production line, employing Korean OLED engineers at major processes from last year. In addition, HKC, which is not a panel maker, is reported to have hired OLED engineers. This is interpreted as a work for investing in the OLED production line of HKC which has only LCD line, and HKC has recently been named as the merger of TIANMA OLED division.
As of 2018, there are no panel makers in China that can produce OLED display panels at the level produced by Korean panel makers. Although the production capacity and sales structure of Chinese panel makers are different from those of Korea, it is difficult to define yields on the same basis. However, the yield of BOE’s Chengdu (B7) plant, known as the mass production line, is still investigated as a single digit. Other panel makers also expect the product quality and yield problems to be difficult to be resolved by the first half of 2019 even if the mass production lines are launched within the year.

In order for the display industry, which contributes significantly to the Korean economy, to maintain its dominant position in the global display industry, it must maintain its competitiveness through various product development, production and sales strategies. Meanwhile, the size of the display industry needs to grow for the growth of the worldwide OLED industry. In order for Chinese panel makers to supply OLED panels with diverse applications, securing the yield might be the key.

[iMiD 2017] You Dream, We OLED

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LG Display is expanding in earnest in OLED market.

In the keynote session of IMID 2017 held in Busan on 29th, LG Display’s CTO Kang In-byeong pointed out the future plan of LG Display as “OLED is a strong candidate to lead the future display industry”.

Kang In-byeong, CTO, said that by 2020, large-area OLED will increase its production capacity by 7 times to 2020, thereby reducing the cost cap with LCD and leading the market on the basis of technology such as wall paper, sound integration, rollable and transparent flexible. LG Display recently invested in Gen8.5 in China and is expected to invest in Gen10.5 OLED mass production line at Paju P10 plant.

On the other hand, for small and medium-sized OLEDs, they have announced that they will use a fast follower strategy based on plastic OLED. LG Display is in mass production of plastic OLED panel to be applied for LG Display’s next smartphone, V30, next smartphone, and is ready for the mass production in the E5 line of Gumi. In addition, they plan to invest 10trn won additionally to Gen6 line, which is expected to increase 13 times the current capacity by 2020.

Based on this aggressive OLED investment, LG Display plans to raise its portion of OLED sales up to 40% in 2020 from current 5% in large-area OLEDs and small- and medium-sized OLEDs.

Currently, large-area OLEDs continue to increase capacity and yield and LG Display is likely to expand sales in the future, as it is dominating the premium TV market as it is expanding the camps of Sony, Philips and Panasonic as well as LG Electronics. The success of mass production in small- and mid-sized OLEDs will determine whether or not LG Display plans to achieve its plan.

LG Display Invests 5 Trillion Won in OLED Business, including Plastic OLED

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LG Display has decided to change its business portfolio to concentrate organic light-emitting diode (OLED) business. Through the conference call that reported operating profits in the fourth quarter of 2016, LG Display announced on January 24 that it plans to invest some 5 trillion won in facilities this year, and put investment in OLED including Gen6 Plastic OLED and large-size OLED manufacturing facilities. Especially, its investment in OLED is expected to rise to 70% by 20% in 2017, compared to last year with a plan to expand the OLED market.

LG Display Chief Financial Officer (CFO) Kim Sang-don said, “LG Display has reorganized its business structure by integrating previous 5 divisions into a total of 3 divisions such as TV, IT and mobile for its business efficiency.” “It will concentrate not only clear picture but also design and price in large-size LCD TV panels, while producing small and mid-size OLED panels focused on E-5 Gen6 POLED mobile and automotive business. Gen6 E-5 plants also plan to start producing POLED in the third quarter this year. Regarding new Capa, the sizes of new OLED will be 55”, 65” and 77”, and the Capa over 65″ is expected to rise more than 40% this year, a 10 % increase from 30% in 2016”.

Kim said, “the company has secured a total of 60,000 OLED TV capa in the second half of the year according to this year’s OLED TV forecast and yield improvement, and this is the capacity that can produce 1.5 million to 1.8 million televisions a year. Also, he emphasized “Our large-size OLED panel achieved the industry’s yield of 80 percent, which means OLED achieved its golden yield in just two years, compared to LCD’s golden yield of 10 years”.

Kim added “Regarding Chinese firms’ large-size LCD panel line extension that has become an issue recently, the production of Gen8.5 OLED and LCD is now available, but we still need to examine technology, production and productivity of over Gen10 panels. We will carefully consider the extension of the super large 60” 4K and 8K market. Also, LG Display’s middle and long-term strategy is to create a new OLED market so as to expand OLED.

With regard to the price comparison with LCD TV, “more than 60,000 capa is added this year through OLED line extension, and this is the capacity that can produce 1.5 million to 1.8 million televisions. It is a very small scale compared to the entire TV market size, and the price comparison with LCD is meaningless” according to him. LG Display announced that it plans to expand the OLED market for commercial purposes such as signage, broadcasting and medical use in 2007, while emphasizing the target of OLED TV is not the competition with LCD but only the high-end premium TV market.

Meanwhile, regarding the ownership of crystal sound that were unveiled at CES 2017 held in Las Vegas, USA, “In addition to LG DISPLAY’s crystal sound panel, its strategic partner Sony Entertainment Television (SET) improved sound through sound control and algorithm, and OLED panel’s quadrant sound control is LG DISPAY’s own technology” it said.

LG DISPLAY posted 7.9360 trillion won in sales and 904 billion won in operating profits in the fourth quarter last year, recording the black-ink balance for 19 consecutive quarters. Its net profits increased to 824.7 billion won, a whopping 335% increase from the previous quarter. 38 percent of sales in the fourth quarter came from displays for televisions; 31 percent from displays for mobile devices; 17 percent for laptops and tablets; and 14 percent for monitors. Due to the increase in panel prices and demands, its sales reached 26.5041 trillion won, and operating profit was 1.3114 trillion won, surpassing the 1 trillion won for a fourth straight year while keeping a positive trend in its profits.

In the meantime, UBI Research expected that LG Display will produce 1.5 million large-size OLED panels over 50-inch.

LG Display Unveils Next-Generation Market Leading Technologies at CES 2017

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<Source :LG Display Unveils Next-Generation Market Leading Technologies at CES>

LG Display is actively participating in the ‘CES (Consumer Electronics Show) 2017’ to be held in Las Vegas, the U.S., from January 5 to 8 to show more diverse products and next-level differentiated technologies.

LG Display plans to convey its purpose to achieve consumer innovation together with LG Display’s differentiated technologies under the slogan of ‘Our Technology, Your Innovation’, at its private showroom for clients in the Las Vegas Convention Center, from January 4 to 8.

Especially, LG Display will showcase new products that basically has superior picture quality and fulfill OLED’s next-level design and potential, as well as a variety of products that provide new future to customers with its own differentiated technologies.

 

■ Unveil the New OLED TV with Superior Picture Quality, and Extreme Design

LG Display will release its differentiated OLED TVs with unsurpassed picture quality and potential application and design.

During CES, it will also introduce a 55-inch transparent FHD display featuring the improved colors and more natural and transparent screen.
LG Display will showcase 65-inch and 77-inch UHD Wall Paper TV line-up with ultra thin and innovative design. It will also show off futuristic displays, including a 77-inch double-sided UHD display and 77-inch six rollable UHD commercial displays, which will open various possibilities of OLED with surpassed picture quality.

 

■ Constantly evolving IPS, Innovative LCD Technology

LG Display’s OLED(Organic Light-Emitting Diode) and a high-resolution technology IPS evolve further.
LG Display will show off IPS products with improved picture quality and price competitiveness by using WCG(Wide Color Gamut, a technology to provide a greater range of colors), HDR(High Dynamic Range, a technique to reproduce a greater dynamic range of luminosity), and high-resolution technical solutions.

Especially, IPS Nano Color at this show is LG Display’s own WCG technology that can express more accurate and vivid colors, using nano-sized wide color gamut.
It is increased with the addition of the strength of IPS OLED to offer high color accuracy. This show will apply it to a 65-inch UHD product.

 

■ User’s Expanded Touch Experience through in–TOUCH, Improved-quality Display

LG Display will expand in-TOUCH technology of touch sensor-embedded panel to 24-inch monitors, while showing off the key advantages of design to offer differentiated values to IT market through its high-resolution product strategy.

in-TOUCH technology offers a thinner and lighter product since there is no Touch Cover Glass.
In addition, Active Pen Solution is applied to a 13.3-inch in-TOUCH panel, so that it features higher touch accuracy outside the screen, faster touch response, and more precise calibration of the touch point, compared to conventional Add-on(touch sensor-added panel).

LG will also show not only the world’s largest 38-inch curve monitor suitable for such offices as stock trading, movie-watching, and immersive gaming but also 32-inch 8K monitor with ultra high resolution and HDR monitor panel for broadcasting and video editing experts.

 

■ Providing Future Vision through its P-OLED with Excellent Picture Quality and Design Freedom

LG Display will provide next-gen futuristic automotive display products through P-OLED(Plastic OLED) with superior picture quality and design freedom.

P-OLED featuring wide screen, perfect expression of black, and high design flexibility is an optimized technology to provide new vision to automotive interior in harmony with the curved surfaces of vehicles.
LG Display plans to have a showroom for visitors to experience futuristic concept products in a real situation, including Cluster that will provide better safety and convenience, Center Information Display, passenger seat display, large transparent OLED, and mirror-type OLED.

Besides, LG Display is aiming to enter the middle and small-sized OLED market through 5.5-inch QHD P-OLED. In addition, it will introduce the P-OLED for Smartwatches with diverse designs, including circular or square pattern.

LG Display Vice Chairman, Han Sang-beom announced “LG Display has offered leading products that can provide new values beyond the expectation of the market, with its differentiated technologies.” “It will proactively respond to the market through its next-generation display OECD and new innovative technologies, and consolidate its position as a leading company”.

 

BY HYUNJUN JANG, HANA OH