The OLED display market in 2019 is really lively. Especially at the beginning of the year, the competition between Huawei and Samsung for folding mobile phone products led the “latest creation” of BOE and Samsung, and set off a wave of “OLED” industry upsurge in public opinion.
However, the real OLED industry drama is not the innovation of mobile phone products, but the new investment “extending” to the large-scale market. The industry expects that the focus of market competition will soon enter a new stage of “OLED” track.
Aiming at large-scale OLED efforts
In October, Samsung announced the R & D and production plan of qd-oled TV panel of 13.1 trillion won (about US $11 billion). By 2025, Samsung plans to establish two qd-oled production lines in Korea, and the first production line will be put into operation in 2021. Samsung was once a monopolist of small-size OLED products for ten years, and it is also the only “large-scale money making” brand for global OLED panel enterprises.
Relying on the long-term technical accumulation of small-size OLED products, Samsung’s technical ability in large-size OLEDs should not be doubted. Moreover, as the world’s largest color TV brand, its own demand for large-size OLED products is astronomical.
On August 29, LG display officially announced that its 8.5 generation OLED panel production line built in Guangzhou, China was officially put into operation. The future production capacity of this production line will be expanded from 60000 substrates per month to 90000. Even the current 60000 substrates are equivalent to the total capacity of LGD Korea’s large-size OLED panel line. In addition, LG is building a 10. Generation 5 OLED large size line.
It is worth mentioning that LG is currently the only enterprise in the world that commercially produces large-size OLED panels. However, due to a series of technical constraints, large-scale OLED projects have been at a loss for a long time. In addition, according to the survey data, the global OLED TV shipment growth was weak in 2019, and some markets shrank: the main reason was the rapid price reduction of large-size LCD. At the same time, the supply of large-size OLED products was tight – especially LGD supplied more 65-77 inch large-size OLEDs, resulting in the decline of the overall cutting quantity of existing production capacity.
In the OLED market, the leadership of the Korean industrial Corps can not be questioned. However, enterprises in Japan and Mainland China are also striving for this “strategic commanding height”.
For example, on November 25, the world’s first mass production line of printed OLED was completed at the ceremony of nengmei in Japan. Joled president said that joled will launch a revolution in the field of medium-sized OLEDs. The base plate size of the production line of nengmei factory is g5.5 (1300x1500mm), and the production capacity is 20000 pieces per month. The adoption of inkjet printing technology will reduce the cost of large-scale printing.
With the help of printed OLED, Japan’s display panel “re” rises, which is almost the “only opportunity” that the Japanese display industry can catch at present. As the birthplace of the development of modern flat panel display and semiconductor display technology, the persistence of Japanese industry comes not only from technical confidence, but also from historical feelings.
Also in November, the commencement ceremony of the world’s first 8.6 generation OLED panel production line project in Changsha was held. In the near future, it will officially enter the piling stage and start construction. This is the latest project of Huike, the third largest company in China. Previously, Huike has built four 8.6 generation LCD panel production lines. As a panel enterprise taking shape, it is inevitable to strive to establish a career in the new large-scale display technology.
It is worth mentioning that the OLED panel enterprises before Huike either focused on the market of small and medium-sized products, or at least had the brand of mass production line on small and medium-sized products. Huike is the only enterprise that directly enters the large-size OLED panel market without going through the small and medium-sized stage. This also reflects the urgency of “time window opportunity” of Huike in the “OLED” project.
In addition, BOE and Huaxing optoelectronics, which rank first and second in China, are also interested in large-size OLEDs. BOE invested 1 billion to build a printing technology OLED production experimental facility in Hefei. In connection with BOE’s investment in four sixth generation OLED lines with evaporation technology, facing the small-size demand market, its printing technology is obviously more prepared to challenge the future large-size OLED applications. Huaxing optoelectronics has not only built printing OLED experimental facilities, but also publicly stated that it plans to print some large-size OLED capacity in its second 11th generation LCD line in Shenzhen.
To sum up, the attraction of large-size OLEDs has increased unprecedentedly. Among the industrial elites, the “technologically conservative Taiwan Legion” has been “involved”. The market competition of large-size OLEDs is changing from the R & D of “technical route” to the practice of “capacity construction”.
Large size OLED is a structural innovation of industry demand and supply
It is not surprising that large-size OLEDs will become the core “focus” of the industry in 2019. Industry experts pointed out that in 2019, traditional LCD products will be further “surplus”, and small-size OLED products have also entered the stage of “massive surplus”. This leads to the highest point of technology competition in the industry and transfer to new goals.
For large-size liquid crystal products, with BOE and Huaxing optoelectronics respectively investing in the construction of two generation 10.5/11 lines and the production of generation 8.6 lines of Huike and other brands, the market structure is experiencing unprecedented “capacity expansion”. Obviously, the higher price of large-size LCD TV than small and medium-sized TV makes it difficult to catch up with the supply growth brought by hundreds of billions of yuan of huge investment. Therefore, over the past three years, large-size LCD products of Korean panel enterprises have been in the process of “de capacity”.
On the other hand, the sales volume of OLED in small size and mobile phone market has increased. So that a large-scale thousand yuan OLED mobile phone product appeared in 2019. This will further squeeze the market share of mobile phone screens of traditional LCD production lines: these excess LCD production lines are either closed directly or changed to produce large-size LCD panel products. The substitution of OLED for liquid crystal further aggravates the oversupply of liquid crystal display products.
Moreover, the accelerated penetration of OLED in small and medium-sized is still “in progress”. For example, the four OLED generation 6 lines invested and constructed by BOE will fully enter the production capacity explosion stage until late 2020 or early 2021. This is determined by the product line investment cycle, technology climbing cycle and market introduction cycle.
According to statistics, the investment scale of 6-generation OLED panel lines in the domestic market alone has reached 10, with an investment of nearly 400 billion yuan. After all these production lines are put into operation in 2021, the monthly production capacity will be as high as 1 million square meters. If all of them are used to manufacture mobile phone display screens, the total capacity is equivalent to 70 million mobile phone screens per month according to the calculation that 190 6.47-inch module products can be cut per mother substrate of BOE G6 flexible OLED production line.
In addition, the newly-built small and medium-sized OLED projects include not only enterprises in mainland China, but also enterprises in Japan, South Korea and Taiwan. Due to the huge capacity of these projects under construction, the investment in the small and medium-sized OLED market represented by the 6th generation line has been “difficult to expand significantly” in the short term.
“Large size LCD and small size OLED have great market pressure.” For example, BOE’s OLED mobile phone screen shipments are expected to reach five times or more of last year. Meanwhile, the shipping capacity of BOE’s generation 10.5 line has at least doubled. This is in sharp contrast to the highly saturated market pattern of color TV, mobile phone and PC. What’s more, after enterprises in mainland China made great efforts to build OLED generation 6 line and LCD generation 10.5/11 line, the investment of enterprises in Taiwan Province, South Korea and Japan “slowed down”. According to news reports, the mass production time of Guangzhou 10.5 generation line LCD factory cooperated by Taiwan and Japan has been postponed.
However, market pressure cannot “veto the competitive relationship between enterprises”. The more pressure there is, the more necessary it is for enterprises to break through: large-scale OLED and printing technology have become a “temporary blank”, but they look like an infinitely beautiful “potential market”.
Moreover, the printing and large-size OLED projects are of “decisive” significance to maintain the leading position of the large-size display industry in the future. LG, Samsung, Huike, joled, BOE and Huaxing optoelectronics all know this. Therefore, since the second half of 2019, large-scale OLED investment has accelerated.
However, in front of large-scale OLED projects, all manufacturers still face huge cost problems. For example, according to the statistics of display supply chain, the cost of one square meter of OLED panel is about $95. Samsung’s new qd-oled architecture is eager to reduce the cost to about $26 per square meter of qd-oled panel by simplifying the 22 layer structure of LGD’s white OLED products to 13 layers. This huge possibility of cost reduction is also the source of manufacturers’ efforts to develop new technologies and eager to try: the first mover advantage of LGD is limited by cost. Whoever breaks through the cost bottleneck first can become the leader of the next generation of color TV sets.
“The Pearl on the crown is shining.” This is the attraction of large OLED panels. Under the background of intensified competition in other market segments and facing absolute or relative technology and overcapacity, enterprises in the industry can break through their own development bottleneck by breaking through large-size OLEDs. Industry insiders predict that a large-scale investment storm in large-scale OLED panels will be on the way in the next three years. The OLED competition between China, Japan and South Korea will also enter a new stage.