Outsourcing Overseas

Samsung Electronics outsourced 68.4% of its TV panels from the Chinese and Taiwanese manufacturers in March this year.
Samsung Electronics outsourced 68.4% of its TV panels from the Chinese and Taiwanese manufacturers in March this year.

 

According to market research firm IHS, Samsung Electronics purchased a total of 3.529 million TV panels from display panel manufacturers around the world in March this year and the purchase from its subsidiary Samsung Display accounted for only 25.1%.

The ratio used to be as high as 45.5% in March last year and 52% in January 2015. However, it dropped to 32.1% in January 2016 and 32.6% in the following month. Meanwhile, Taiwanese company Innolux recorded 24.1% in March this year, followed by China Star (16.9%), BOE (15.9%) and AU Optronics (11.5%). The supply from the Chinese and Taiwanese manufacturers amounted to 68.4% in that month.

According to industry insiders, this can be attributed to a delay in production on the part of Samsung Display. The company recently reduced the thickness of its glass substrates from 0.5 T (mm) to 0.4 T (mm) for the purpose of cost reduction but the product yield fell during the course. “Production-related problems and those related to panel prices combined with each other to result in the drop,” Samsung Display explained, adding, “The ratio is likely to rebound once the panel production goes back to normal in the second quarter.”

In the meantime, it has been found that LG Electronics is continuing to rely heavily on its subsidiary LG Display. In March, 70.9% of the TV panels supplied to LG Electronics were from LG Display. 

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