Challenging Decision
As LG Display has decided to start mass producing small and medium-sized plastic organic light emitting diodes (POLEDs) at the end of this year and supply them to Chinese smartphone makers, all eyes are on whether the company can change the smartphone OLED market landscape monopolized by Samsung Display.
According to industry sources on April 16, LG Display will begin mass production of a 6th-generation POLED (1,500×1,850㎜) at the Gumi E5 production facility in North Gyeongsang Province from the third quarter this year and supply them to Chinese smartphone manufacturer in small quantities from the end of this year.
Until now, the large TV OLED market has been led by LG, while the small and mid-size smartphone OLED market has been led by Samsung. According to market researcher IHS, Samsung Display had a 97.7 percent share in the small and mid-size OLED market as of the first quarter this year. There have been only few brands that use OLED panels in smartphones until recently. However, Apple and Chinese smartphone makers have started using OLED panels in their products and OLEDs are now in great demand. Accordingly, LG Display will jump into them market in earnest.
LG Display, which currently produces 14,000 units of a 4.5th-generation POLED a month at the Paju plant in Gyeonggi Province, will start mass production at the 6th-generation POLED production facility in Gumi, North Gyeongsang Province, from the third quarter this year. The company invested 1.99 trillion won (US$1.75 billion) in building a 6th-generation POLED production line with a monthly production capacity of 15,000 units, at the E6 plant in Paju last year. The E6 plant in Paju will begin mass production from the second quarter next year. In addition, some say that it is not confirmed yet but LG Display is highly likely to produce large OLEDs and POLEDs at the P10 production facility in Paju which is currently under construction.
In particular, Google recently announced its plan to invest some 1 trillion won (US$878.73 million) in LG Display’s facilities, attracting attention in the market. Market experts believe that Google seeks to form a strategic partnership with LG Display in order to feature OLEDs in its Pixel flagship phone.
However, Apple chose Samsung Display as its OLED panel supplier for the iPhone 8 to be released this year, instead of LG display, which has been a LCD panel supplier for iPhones for a long time, and ordered 70 million units of curved OLEDs. Industry watchers say that LG Display will also supply partial quantities to Apple as Samsung Display will have difficulties to meet Apple’s strict conditions. An official from the industry said, “Apple asks for above average quality tests to such an extent that companies, which supplied products even once, were blown away. It will be hard to meet the yield rates that Apple wants at one go.”