Panel analysis: LCD oversupply, OLED accelerating penetration
South Korea, Taiwan, and China are currently the three major panel production bases in the world, especially China. Since 2011, panel companies represented by BOE have continuously expanded their investment. China has also grown rapidly from no panel companies to 9 in 2016, and its market share has just started in 2011 and has rapidly increased to 46% in 2017. On the other hand, Japan, which was once one of the largest panel production countries, has fallen from 9 at its peak to 2 at present in the past six years. Sharp was acquired by Hon Hai, and JDI was under pressure from debt and performance. Facing a bankruptcy crisis.
LCD for Samsung's status gradually increases According to IHS data, global OLED shipments reached 464 million in 2017, an annual increase of 12%, and the output value reached US$25.2 billion, an annual increase of 63.6%. In 2017, global display panel shipments were 3.827 billion pieces, an annual increase of 4.9%, and the output value was US$127.2 billion, an annual increase of 21.2%. From the data, it can be seen that the growth of OLED shipments far exceeds the industry average, and the proportion of panel shipments has increased year by year, reaching 12% in 2017. According to IHS estimates, OLED shipments in 2020 are expected to reach 922 million pieces, with an output value of approximately US$42.1 billion, accounting for approximately 23% of panel shipments.
LCD for Samsung panels are currently mainly used in small-size consumer electronics, among them, soft OLED is the future trend of small-size consumer electronics. Whether the penetration rate can increase rapidly depends on whether the product price can be effectively reduced. At present, the cost price of small-size OLED has fallen to the level of LCD. As the demand for full-screen and curved screens in mobile phones increases, the demand for flexible AMOLED panels in smartphones is also increasing, and the flagship models of mainstream smartphones are also increasing. AMOLED screens are successively adopted to form differentiation to grab market share. According to IHS data, the shipment of flexible AMOLED in 2018 reached 157.6 million, which is expected to rise to 420 million in 2022, accounting for 55% of OLED screens, with a compound annual growth rate of 22%.
Currently, China’s OLED panel companies mainly include BOE, Tianma, China Star Optoelectronics, Rouyu, etc. There are 18 OLED production lines that have been built or planned, with an annual production capacity of 8.004 million pieces. The proportion of small-size AMOLED production capacity will increase from 16% in 2018 to 37% in 2021. In terms of long-term oversupply of large-size LCD panels, data shows that from 2018 to 2021, the global production capacity of large-size TFT-LCD panels will increase by 77.7 million square meters, and the production capacity will increase by 31%. However, the market demand in 2021 is estimated to be approximately At 49 million square meters. The oversupply ratio will increase from 12% in 2018 to 23% in 2021, and the development trend of large-size LCD products in the future is mainly to improve the resolution and move towards higher picture quality.
In general, the development trend of panel technology, the market share of small-size OLED will gradually increase. Among them, soft OLED will be the mainstream in the next 3 to 5 years. As for the longer-term development, it depends on whether Micro LED can make further breakthroughs in technology and cost. On the other hand, large-size panels are mainly moving towards larger size and ultra-high image quality technology. The main source of LCD growth today is consumer demand for larger panels and improved display performance, as well as the demand for panels in emerging fields.
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