The worst production decline in LCD panel history, BOE and other Chinese companies benefit

by:Kimeery     2021-06-05

The price of LCD panels, which was still declining sharply at the end of last year, has now changed. The price has started to increase at the beginning of this year. The recent epidemic crisis has worsened the situation. However, the core factor for LCD price increase is that many manufacturers have reduced or stopped LCD production lines since last year. , The reduction in LCD production capacity this time is even more serious than in 2016.

Like semiconductor chips, panel production has experienced a cycle of price increase and price decrease. In 2016, there was a big price increase for LCD globally. The LCD production capacity withdrawn that year was as high as 3.615 million square meters. Last year, The LCD production capacity closed this year is much higher. The production capacity closed last year was 2.513 million square meters, and the capacity to be closed this year reached 5.519 million square meters, accounting for 6.47% of the global production capacity, which is higher than the exit ratio before the last big price increase. It is 1.07 percentage points higher.

The main force in this wave of capacity withdrawal is South Korean companies, especially Samsung and LGD. They are also the world’s No. 1 and No. 2 TV brands. However, Samsung’s main production capacity has long since turned to LCD for Samsung panels and LCDs are withdrawn. There are not many production lines. LG is going to close South Korea’s local P7 and P8 production lines, and the exited production capacity accounts for 12% of its global production capacity.

Currently, several LCD panel factories in mainland China account for about 50% of the world’s LCD production capacity. Companies such as BOE are also reducing LCD investment, but the LCD production capacity withdrawn is not as large as that of Korean companies. On the contrary, they are in South Korea. After the company withdraws from LCD production capacity, Samsung, LG and other companies will increase their outsourcing of LCD panels to reduce costs. Therefore, in this wave of LCD production adjustments, Chinese companies such as BOE will also benefit in the future and further increase their LCD market share. (Quick Technology)

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