Recently, some Korean media reported that there was a scene of executives in front of the LGD headquarters in front of a thousand employees, with goggles arrogant LCD panel scene, allegedly the executives on the scene to demonstrate their determination to transform the OLED factory.
LCD panel used to be the biggest contributor to LGD's rise in display. In the global popular 4.5-8.5 generation panel line stage, LGD has become the world's largest with its huge production capacity and low cost advantage of advanced production lines. LCD panel makers were overtaken by Chinese panel maker BOE until this year.
LGD's LCD technology is also very powerful. Together with JDI Japan, he has developed the world's best LCD mobile phone panel for Apple, and is also the main supplier of high-end LCD TV panels in the world. Since 2012, LGD has received large orders for mobile phones and TV screens from Apple and LG Electronics for five consecutive years.
However, since the second half of last year, with the acceleration of the industry's capacity expansion, coupled with the geopolitical and international trade environment, LGD's two major LCD TV panel markets have had problems. First of all, the consumption shrinkage and consumption degradation in western developed countries are very serious, which greatly reduces the consumer's desire to buy LGD high-end TV products. Secondly, in emerging markets, it faces the price blow of Chinese panel makers and the market share of IPTV products on LPG products. Therefore, LGD faced double pressures on the number of shipments and sales prices in the global market in 2018. The overall reversal of performance has turned into a huge loss from high profit. In July this year, LGD announced that its operating loss was nearly 2. $22.1 billion.
In fact, since the LCD panel entered the 8.5-generation line, its price has been rapidly decreasing by 25% to 35% per year, which has led the industry to profit from promoting larger-sized products through larger production capacity. However, after entering 65 inches, the cutting economy of the panel began to encounter bottlenecks. The cost of investing in higher generation production lines is also difficult to profit from the promotion of larger size products, because the size of the panel has exceeded consumption. The living environment of the person is limited. And after years of popularization of LCD TVs, the market environment has also changed from an incremental market to a stock market. The growth rate of shipments has not kept pace with the decline in market prices.
However, in addition to maintaining a large capacity on the LCD, LGD also exclusively develops and supplies OLED TV panels in the market. However, due to the small capacity and high cost, LGD is temporarily unable to make profits from OLED TV panels. However, in order to enhance its competitiveness in the panel field, LGD has listed the expansion of OLED panel capacity as the business focus in the past two years. This time, the LGD executives and LCD panels are also determined to transform the OLED.
On the OLED TV panel, in addition to building a new high-generation line in Guangzhou, China, LGD is also preparing to build a ten-generation OLED panel line in South Korea to achieve the goal of multiplying capacity, in order to reduce the cost to half now. The high-end market competes with LCD panels.
In addition, LGD has developed OLED displays for Apple's smart watches in the small and medium size field, and has also been developing on OLED mobile phone panels for many years. In order to improve its OLED supply capacity, Apple also invested in LGD's OLED mobile phone panel line. When it was sent to Apple last year, it also passed Apple's test. However, in the mass production stage, evaporation technology and Samsung have obvious advantages. The difference is therefore not delivered.
Later, LGD also introduced the same evaporation equipment as Samsung. According to Li Xing, LGD solved the chromatic aberration problem quickly after adopting the new equipment, but there were other abnormalities in the process. The products produced did not have reliability test. Meet the standard.
In the near future, the Korean media once again reported that LGD's prototype of this year's new iPhone OLED panel has also passed the test of Apple. Apple also gave LGD risk orders and supported it again.
At present, in the global OLED panel market, TV panels are almost monopolized by LGD, 100% produced and supplied by LGD; mobile phone panels are monopolized by Samsung over 90%, and the remaining LGD, BOE, Shenzhen Tianma, Hehui, Wei The shipments of CIGNA are added together, and the annual output is about 10 million pieces. It is difficult to exceed 20 million pieces in total.
However, although the industry analyzes the material cost of OLEDs to be lower than that of LCDs, the cost advantage in competing with LCDs after the industry matures is very obvious. However, if the cost of the final module product is relatively high, the cost of the display module of the OLED is at least three to 90% higher than that of the LCD. The comprehensive cost of some products is even about three times that of the LCD.
OLED is a solid-state display device, which can realize bending flexibility, which can greatly expand the design space of the terminal product. The application scene is much more flexible than the LCD, and the display effect and product environment reliability are also much higher than the LCD. Compared with LCD, the only weakness of OLED is the service life.
If the material technology of OLED is broken, OLED can not directly compete with LCD in cost. In fact, the comprehensive performance and overall cost of OLED will also fully suppress LCD. From this point of view, OLED still has a lot of room for improvement, and LCD technology has encountered the ceiling. After OLED catches up, the complete replacement of LCD will become an irreversible trend in the industry.