Chinese panel maker BOE took advantage of manufacturing technology to stifle Japan and South Korea with price war

- Jun 29, 2018-

Foreign media reports that BOE, the country’s largest panel maker, has started production on its 10.5-generation line (which is also the world's most advanced panel production line) and announced to manufacturers in the first quarter of this year that the 65-inch panel will be reduced by 20%. The price war quickly grabs more market share.

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East's ranking in the world continues to rise

In 2003, BOE officially obtained its own LCD panel production technology through the acquisition of Hyundai's LCD panel production line. Afterwards, through hard work for nearly 6 years, it announced in 2009 that it was building the 8.5th generation line that was at the global advanced level. We keep up with Japanese and Korean manufacturers in panel production technology.

Since then, BOE has continued to expand its panel production line and continuously increase the production capacity of LCD panels. Last year, WitsView data show that BOE has become the second largest panel maker in the world, second only to LGD, which is also the first time BOE took away. Get this ranking. Last year's data showed that South Korea's two major panel makers LGD and Samsung's shipments have declined, respectively year-on-year decline of 3.9%, 15.4%, while China's two major panel makers BOE and China Star Optoelectronics have achieved Positive growth.

It is because of the continuous improvement in strength that BOE and Huaxing Optoelectronics, two major panel makers in China, have begun investing heavily in building the world's most advanced 10.5/11 generation line. This is also the world’s most advanced LCD panel production line. Prior to this, the world’s most advanced The LCD panel production line is the 10th generation line of Japan Sharp, and Sharp has been acquired by Hon Hai of Taiwan.

Under the efforts of BOE and China Star Optoelectronics panel makers in mainland China, China had completely relied on imported LCD panels to become the world’s second largest manufacturer of LCD panels since then, and it was also the 10.5/11 generation of BOE and Huaxing Optoelectronics. After the line is put into operation, the Chinese mainland is expected to further increase to become the world's largest LCD panel production site.

BOE's contrarian expansion

The global shortage of LCD panels started in 2016 has triggered the rise in the prices of global LCD panels. However, the price of LCD panels began to decline in the second half of last year. At this time, BOE took the lead to call for a 20% price cut, which is undoubtedly for Japan. The panel makers in Korea have made tremendous shocks and demonstrated the strength of BOE.

In fact, Japanese and Korean manufacturers, especially South Korea's two major panel makers, LGD and Samsung, have already seen the Chinese panel makers enterprising and aggressive, intending to reduce LCD panel production capacity, and instead invest in more profitable OLED panels. , However, in addition to Samsung has made huge profits from the small and medium sized OLED panel market, LGD focused on large-size OLED panels for television has been in a loss, LGD need to rely on the profits of the LCD panel to help its OLED panel business development of.

BOE’s start of pricing strategy at this time undoubtedly puts great pressure on LGD. Due to the high production cost of LCD panels from Korean panel makers, it is obviously unable to compare with BOE in terms of price, and BOE adopts a more advanced LCD panel. The lower cost of production technology makes it more emboldened to start a price war and take advantage of more market share, which will help Jingdong defeat LGD into the world's largest TV panel supplier.

After consolidating the market share advantage in the LCD panel market, this may help BOE to provide support for South Korean manufacturers in the OLED panel business by accumulating funds in the LCD panel business. BOE has put into production of small and medium sized OLED panels, and it is currently planning construction. The second 10.5 generation line - Hefei production line will layout OLED panel production technology, hoping to achieve technical breakthroughs in large-size OLED panel to compete with LGD, which shows BOE's ambition.

Through more than ten years of efforts, BOE has gone from scratch to technologically meeting the Korean panel makers and becoming a representative of China's high-end manufacturing industry. Its success is becoming a model for China's manufacturing transition to high-end manufacturing.