LCD Panel Prices Starting to Tick down
LCD panel prices are on the decline these days after a steep rise since last year. The strong rebound in LCD panel prices led Samsung Display and LG Display to shelve their plans to withdraw from the LCD market. Yet, they are now considering terminating their LCD business again as LCD panel prices have started to fall.
Samsung Display and LG Display are weighing the timing of their withdrawal from the LCD panel market. Samsung Display is reportedly planning to completely withdraw from the LCD business in the first half of next year. LG Display is more flexible about the termination of its LCD business for domestically produced TVs. “Samsung and LG are expected to withdraw from the LCD business earlier than expected due to a sharp drop in LCD prices,” an industry insider said.
LCD panel prices had been on the rise for nearly a year since the middle of 2020, but have been falling for the fourth consecutive month after peaking in July. According to market research firm WitsView, LCD panel prices plunged about 22 percent in October and fell 2 to 3 percent in the second half of November. LCD TV panel prices (55 inches) fell from US$228 per unit in July to US$130 in November. Industry insiders expect the downward trend to continue until early next year.
Global TV demand began to weaken as many counties recently implemented “with-COVID-19” policies. Global TV shipments in the second half of 2021 stood at 111.64 million units, down 12.4 percent from a year earlier. In particular, some experts forecast that the LCD panel price decline will become steeper due to oversupply as Chinese display companies are ramping up their LCD panel production.
Samsung Display and LG Display have begun to quickly revise their strategies due to falling LCD prices. Initially, Samsung Display was planning to give up its LCD business by dismantling its 7th- and 8th-generation LCD lines in Korea and China by the end of 2020. An 8th-generation LCD production line in Suzhou, China, has already been sold to TCL CSOT in China. Currently, only the L8-2 Line in Asan Campus, South Chungcheong Province in Korea, is in operation among its 7th- and 8th-generation LCD panel production lines.
Recently, Samsung Display is dismantling the L8-1 LCD production line in Asan Campus. It will be converted into an 8th generation OLED panel production line. The 7th-generation panel production line of L7-1 stopped running in 2016 and changed into a 6th-generation OLED panel production line. The L7-2 Line is transforming into a 6th-generation OLED panel production line. The company is likely to completely abandon its remaining L8-2 Line by the first half of 2022 and turn it into an 8th-generation OLED panel production line in the second half of next year.
LG Display also planned to close down its LCD panel production line for domestically produced TVs in 2020, but changed its mind and extended their production. The company is currently using facilities to produce LCD panels without adding additional resources. However, in recent years, as a large portion of TV panel supplies has been converted to IT supplies such as laptops, tablets, and monitors, the company is gradually lowering LCD panel production.
However, LG Display plans to continue its LCD panel business by operating its Guangzhou plant in China as its main TV LCD production plant without completely withdrawing from the LCD panel business.