Through coexistence with partner companies, LG Display has succeeded in the local production of the main components for curved organic light-emitting diode (OLED) panels, which are considered a new growth engine in the future.
According to LG Display on Nov. 23, the company suggested Poongwon Precision Co., a TV component maker in Ansan, Gyeonggi Province, to develop a new process method for metal foil, the core component for curved OLED TVs, in 2013.
Since OLEDs are vulnerable to moisture and heat, they need strippers to block the contact with oxygen. Poongwon Precision’s metal foil was lighter and thinner than the one imported from a Japanese company earlier, so it was perfect to realize a curved display.
In order to produce curved OLED TV panels, LG Display desperately needed this metal foil. However, the existing metal foil manufacturing method of Poongwon Precision cost a lot. Therefore, the company should lower such a high production cost per unit. In addition, LG Display could face setbacks to mass produce its 55-inch curved OLED panel if the company don’t improve Poongwon Precision’s metal foil yield rate, which fell short of 50 percent.
So, LG Display decided to send eight process innovation experts to Poongwon Precision from September 2013 in a bid to share its expertise in process improvement and development. Moreover, the company supplied its development funds. After LG Display advisory panels found out that the laser machine equipment caused such low yield rates, it helped supplementing and stabilizing the production facilities. With efforts from the two companies, Poongwon Precision finally succeeded in developing a new metal foil production technology last year. Then, LG Display also succeeded in replacing the existing Japanese component with Poongwon Precision’s metal foil for localization.
An official from LG Display said, “When we replace the existing Japanese component by next year, we will have an import substitution effect worth 50 billion won [US$43.12 million].” Poongwon Precision is also expected to see a growth in sales from 8 billion won (US$6.9 million) last year to 20 billion won (US$17.25 million) next year.