Chinese TV manufacturers are aggressively targeting the OLED market, dominated by Samsung and LG, with their large LCD products offered at breakthrough prices.
During the “Korea Display Conference” hosted by Omdia in the Seocho district of Seoul on March 13, Park Kyung-sun, director at Omdia Korea, stated, “The rapid rise of the large TV market led by Chinese companies is negatively affecting the OLED market. Chinese firms, having seized control of the LCD supply chain, are leveraging LCD’s biggest strengths - large size and low price - to put pressure on OLED technology.”
In November last year, TCL reduced the price of its 98-inch LCD TV from US$5,999 to US$3,499. Hisense, a competitor in the North American market, responded by offering its 100-inch MiniLED TV at the same price. This sparked a price competition race, prompting Samsung Electronics to lower the price of its 98-inch model from US$7,999 to US$4,990 in July of the same year.
After Black Friday, the price war intensified further. Park said, “After Black Friday, TCL set the price of its 98-inch TV to US$1,999, initiating another price race. By offering a 98-inch TV at US$1,999, focusing only on size and smart features, TCL challenged the conventional wisdom that ‘TVs larger than 98 inches are premium,’ effectively bursting the premium price bubble.”
“This situation puts significant pressure on competitors, including Samsung and LG, who also sell large products over 98 inches. The bigger issue is that it further widens the price gap with OLED,” Park added.
For instance, LG Electronics’ 97-inch OLED TV is priced at US$24,999, which is US$23,000 more expensive than TCL’s 98-inch LCD TV, despite being only an inch smaller, equating to a difference of about 30 million won.
In response to this trend, Samsung and LG Electronics are expanding their low-cost lineups. Park mentioned, “LG Electronics has never launched a 98-inch LCD product before, as it goes against their OLED premium strategy. However, given the market’s swift shift towards products larger than 98 inches, they are preparing to launch a 98-inch LCD product.”
Indeed, LG Electronics announced the release of a new 98-inch QNED TV today. While the maximum size was 86 inches until last year, this year, the lineup has expanded to include 98-inch models, completing the full lineup of QNED TVs ranging from small to large sizes. The shipment price for the North American market is set at US$6,999.
Chinese companies are also looking to increase their market share by acquiring LCD display panel factories that are up for sale. The sale of LG Display’s 8.5th generation LCD factory in Guangzhou, China, and Sharp’s SIO 10.5th generation LCD factory, is currently being pursued, with several Chinese companies showing interest.
With the potential acquisition of foreign factories by Chinese companies, there’s speculation that the market structure could change. David Xie, an executive, predicted at the conference that if BOE acquires LG Display’s Guangzhou factory, its LCD market share would rise to 29.8% by 2026, and if China Star Optoelectronics Technology (CSOT) acquires Sharp’s Chinese LCD factory, its share would increase to 25.5%. This would mean that the two Chinese companies would control over 55% of the market, a share comparable to the combined market share of Samsung Display and LG Display in 2011, according to Xie’s analysis.