Opportunity or Risk?
Samsung Display, which currently has a share of more than 90% in the global mobile OLED panel market, recently placed new orders for flexible OLED panel production facilities worth 400 billion won or so before putting them into operation early next year.
It is said that Apple is going to adopt OLED display panels for its iPhone 7S to be released in 2017. Under the circumstances, Samsung Display and LG Display are looking to invest more in their OLED panel manufacturing facilities
Samsung Display, which currently has a share of more than 90% in the global mobile OLED panel market, recently placed new orders for flexible OLED panel production facilities worth 400 billion won or so before putting them into operation early next year. The new facilities are expected to double the company’s mobile OLED panel production capacity to 30,000 sheets of mother glass a month.
Still, this is not enough given that Apple sells no less than 200 million iPhones a year and Samsung Display is barely meeting the demands from Samsung Electronics, its largest customer, these days. “Samsung Display has to spend at least 10 trillion won if it is able to meet Apple’s, Chinese clients’ and Samsung Electronics’ demands at the same time,” said an industry insider, continuing, “Such a large investment entails significant risks though.”
In the meantime, LG Display is predicted to make an additional investment in its sixth-generation OLED panel manufacturing facilities, too. The company recently announced that it would invest 10 trillion won in the industry by 2018 and a significant portion of the investment is expected to go to smaller OLED panels. Its five-inch OLED panel production capacity is estimated to be increased to five million units a month in the near future.
Nowadays, not only the South Korean display panel manufacturers but also Japan Display, AUO and many other non-Korean companies are paying much attention to Apple’s move. Some industry experts are expressing concerns though. “In the past, some Japanese companies had a hard time after a rapid increase in facility investment as Apple reduced its orders for their components,” one of them explained, adding, “They should be advised that a business partnership with Apple is an opportunity and a risk at the same time.”