LCD can't rise, Samsung shuts down production capacity in March next year, LG still supplies flexibly

After declaring to postpone the closing time of the L8 production line, Samsung has recently used various industrial chain relationships to find buyers in Mainland China to receive its L8 production line equipment.

According to relevant sources, Samsung hopes to finalize the specific buyer and transaction amount before February next year, and start dismantling the L8 production line in March next year.

This also means that after March next year, only part of the L7 production line of Samsung's LCD business is still in operation, and the L7 production line has also been transformed by Samsung, which is basically used to produce OLED touch sensors.

Different from Samsung’s strategy of shutting down LCD production capacity, after announcing the postponement of shutting down LCD production capacity, LGD stated that the production of LCD TV panels in South Korea will be carried out flexibly in accordance with customer needs and short-term supply requirements in existing facilities and available resources, while following the structure. The principle of innovation.

In other words, LGD did not explicitly state that it will shut down LCD production capacity, but it will also follow the principle of structural innovation and be prepared to shut down production capacity.

Judging from the current status of the industry chain, since the second quarter of this year, LCD panel price increases have met the break-even point of South Korea's 8.5-generation line. If the industry's capacity supply is tight, South Korea's LCD panel production capacity may continue to survive.

Despite the continuous production of the new 8.5/8.6/10.5 generation line LCD production in Mainland China, South Korea’s panel shipments last year accounted for about 20% of the global share.

However, since the third quarter of last year, the two major panel makers in South Korea have begun to significantly reduce their LCD production capacity to avoid market prices under the inversion of costs and continue to expand their LCD business losses.

When the epidemic was serious in April this year, South Korea’s LCD panel production capacity accounted for less than 10% of the global LCD production capacity, and only had a market share of about 9%.

Regardless of whether it is Samsung or LGD, the retired production line hopes that mainland Chinese manufacturers can receive the residual value of their equipment, and obtain the product MASK module transfer fee and process package service fee.

However, in comparison, Samsung's LCD panel production line is easier to find buyers in the Chinese mainland market, which is related to Samsung's LCD technology with MVA wide viewing angle technology. LG is mainly IPS wide viewing angle technology.

LCD panels with MVA technology have higher color performance capabilities than LCD panels with IPS technology. If it is not for the capacitive touch screen technology promoted by Apple, the so-called "hard screen" of IPS technology can better work with capacitive touch screens. IPS technology It may still be in the category of low-end panels.

Samsung’s previous low-generation panel production capacity was successfully sold to Truly Group, and part of the L7 and L8 production capacity was sold to Shenzhen Jiatai. The L7 reassembly line was selected in Guangxi, and the L8 reassembly line was selected in Zhejiang.

After Samsung transferred Suzhou Samsung to its old partner, Huaxing Optoelectronics, what is urgently needed to find buyers in mainland China is the remaining capacity equipment of L8.

In fact, LGD can also flexibly supply in the LCD panel market, mainly because its panel technology is IPS technology that can be used with touch screens, allowing LGD to obtain more differentiated orders in the field of IT panels and conference tablets, not just It was the price increase of TV panels that caused LGD's LCD business to turn from loss to profit.

At this time, Samsung still decided to clear its LCD panel production capacity. It was Samsung's estimate that this wave of LCD panel prices has reached its peak. The off-season begins in the second quarter of next year, and LCD panel prices will return to the downward channel.

Therefore, Samsung hopes to be able to sell the LCD production line equipment at a high price at the current high point of this wave of LCD panel prices. At the same time, this time will also be more conducive to buyers in mainland China to modify their investment feasibility reports. Can get more money from the Chinese mainland government and capital market.

After shrinking or terminating LCD panel production, both Samsung and LGD invested relevant resources in the field of display panels with updated technologies.

Among them, Samsung hopes to industrialize QD-OLED or QD-LED panels in the field of large-size TVs and continue to occupy the global high-end display market.

LGD focused on W-OLED TV panels and continued to promote the industrialization of 10.5 generation W-OLED panels.

After two decades of development, LCD technology has become very mature. It is easy to obtain relevant technology and equipment elements from the market. In addition, the openness of the capital market in Mainland China is limited. There is a large amount of redundant capital hoping to invest in the so-called "high-tech "Capital gains are obtained in product manufacturing, so LCD has become one of the ideal markets for rapid capital realization in Mainland China.

Therefore, in addition to purchasing new production lines for investment and expansion, the more cost-effective overseas decommissioned panel factory production lines have also become important target materials for attracting mainland Chinese capital to apply for projects.

In addition to mature technology, these production lines generally also come with ready-made mass production process packages, mass production modules, and even ready-made orders to support production lines from trial run-in to formal mass production.

With the mass production of all the 10.5-generation production lines in Mainland China and the completion of the ramp-up of production capacity, and the resetting of the capacity of Samsung’s old production lines in Mainland China, in the future, Mainland China’s LCD panel market share in the global market will account for approximately five China’s mainland has also become the world’s largest LCD display production base after the world’s largest CRT display production base.