Original title LCD market polarized domestic manufacturers usher in a turnaround
In the face of falling LCD panel prices, domestic panel manufacturers have begun to reduce the output of liquid crystal displays (LCDs), and many manufacturers have shifted their focus from LCD to other areas. According to statistics from China Knowledge, in terms of shipments, BOE, the world ’s largest LCD display company, has reduced output of its 10.5 generation production line by 25%, TCL Huaxing (Huaxing Optoelectronics, a subsidiary of TCL Group) and Huike 8.5 generation LCD Panel production has also been reduced by 10% and 20%, respectively.
Previously, with the rapid development of the mobile phone and LCD TV industries, LCD screens have become well-deserved mainstream screens. However, in recent years, LCD competition has become increasingly fierce, and its profits have been significantly reduced. The emergence of new technologies has even put LCD in a desperate situation. International manufacturers have said they will withdraw from the LCD race.
The reporter learned that there are different sizes in the LCD field. Small-size LCDs are being replaced, and small displays are moving towards OLEDs and even flexible panels. However, there is no alternative for large-size LCDs. As Japanese and Korean manufacturers gradually withdraw from LCD production capacity in 2020, the supply and demand situation of the entire large-size display market is improving. Domestic companies such as TCL Huaxing are on the rise and continue to grow and strengthen in the process of industry reshuffle. Core competitiveness 2. Market share continues to increase.
Small LCDs are being replaced
Recently, Yoshio Tamura, deputy director of the Japanese market research company DSCC, said that as South Korea ’s LCD capacity declines next year, its LCD TV supply chain will undergo a major change. Among them, Samsung VD ’s procurement target will shift to TCL Huaxing and CEC (China Electronics Information Industry Group Co., Ltd.), and LG Electronics will likely hand over more orders to BOE.
In a recent interview with the media, BOE Chairman Chen Yanshun said that LCD ’s future development space is low, BOE will stop investing in LCD production lines, and the company ’s resources will focus more on OLED and emerging MiniLED and MicroLED fields. As a leader in the industry, this decision of BOE may herald the end of global LCD capacity expansion.
An executive of a display manufacturer believes that LCD is a cyclical industry. The initial investment of LCD is huge, with tens of billions of dollars, but the profit cycle is very long, and it is difficult to recover profits in the short term. With the rise of China's LCD industry, China's LCD products are technically no different from Japan and South Korea, but the price is more advantageous.
When asked by reporters, many large panel manufacturers worldwide have withdrawn from the LCD business, and the reason for the rapid increase in the proportion of Chinese manufacturers, the person said that from the external environment, after the LCD panel technology is mastered by Chinese manufacturers, domestic panel cost advantages As a result, panel prices have continued to decline, and the competitive advantage of non-domestic panel makers' brands has been severely weakened. From the point of view of manufacturers, electronic brands such as Panasonic are also undergoing transformation and upgrading to more critical upstream devices and strategies such as new materials and new energy Sex emerging industries transfer.
More crucially, some industry experts have stressed to reporters that small-sized LCDs are indeed being replaced by new technologies such as OLEDs, but large-sized LCDs have no alternatives for the time being. "What's more, LTPS LCD is actually a high-end product in LCD, mainly for laptop computer screens and car display screens. This business is also good."
Domestic LCD market ushering in a turnaround
It is reported that Samsung ’s domestic 8.5 generation line has been shut down since July this year. In recent years, another Korean display manufacturer, LGD, which has bet heavily on large-size white OLEDs, is also planning to shut down Korean LCD. Size panel capacity.
AU Optronics and Innolux have a hard time. Observed from public financial report data, AU Optronics ’gross profit margin dropped to 2.8% in the second quarter of this year, while Innolux ’s gross profit margin was 2.62% in the second quarter. With extremely low gross margins, their losses are almost unavoidable.
Although unable to shake off the influence of the industry trough, TCL Huaxing, Tianma Microelectronics and BOE showed different degrees of net profit decline in the 2019 semi-annual report, but related manufacturers have kept the net profit positive.
Guosheng Securities said that BOE (18% of global LCD panel shipments in 2018, the same below), TCL Huaxing (9%), Sharp (3%), all have two 10.5 generation lines climbing production or under construction, and With rich experience and ability to operate high-generation lines, it is the most stable source of supply growth. These high-generation line capacity will be mainly applied to large-size TVs of 65-inch, 75-inch and above. On the one hand, it is conducive to the elimination of new production capacity, on the other hand, it will promote the decline in the price and penetration of large-size TVs.
According to IHS forecast data, the global panel area size will grow at a compound annual growth rate of 5% in the next five years. Among them, domestic leading companies TCL Huaxing and BOE are in the top two with 17% and 11% respectively.
