LG Display to sell OLED panels to China's Skyworth TV
LG Display cells open to competition.
With the imminent opening of their OLED fab in Guanzhou, China, industry sources indicate that LG Display has been negotiating with Chinese TV makers to sell on their OLED panels in open cell form.While this was expected by industry watchers, the timing of the announcement comes mere weeks before the plant is due to be completed on August 29th.
LG Display’s head of the Chinese TV division, Ahn Seung-mo, indicated to media that China’s Skyworth TV manufacturer was one of the companies involved.
“TV manufacturers can cut costs by buying open cell panels,” said Ahn.
Selling display panels in the ‘open cell’ state is quite usual with LCD panels and enables costs to be cut since TV makers can decide upon the extent of further assembly procedures, which allows them to moderate costs. So, for example, an LCD panel is shipped to a TV maker in open cell form and the type of backlight, driver IC to be included etc can be assembled according to company requirements for shipping and sales.
Since OLED panels don’t have backlights, the opportunity for cutting costs is reduced but there are still areas that may contribute to efficiencies such as cutting labour costs at the panel production end before shipping to the TV set manufacturer.
Commentators say that the OLED open cell business opportunities could lead to bigger sales in China as innovative TV companies can add their own customised designs to the panels and compete with LG Display.
For their own TV models, LG Display will continue to use their own established suppliers to maintain its proven technological advantage but the opportunity for competition is available for local TV makers and, if OLED sales increase overall, regardless of the individual manufacturer, it still benefits LG Display as the supplier of the open cell panels.
Park Gi-chan, a professor at Konkuk University, explained, “A better performing company can crop up to stimulate the market, but at the same time, LG Display can shine due to a lack of experienced companies.”
China’s market potential aside, Europe is still the largest market for OLED TVs and according to figures from technology research monitoring group, IHS Markit, more than half of the global OLED sales during the first quarter of 2019 occurred in Europe, which was up from 45 per cent last year - equating to an annual total of 1.14 million OLED sets sold in Europe during 2018.
Screen sizes of 55-inches are still twice as popular as larger 65-inch displays in Europe, compared to the US where, of the 520,000 OLEDs sold, slightly more were 65-inches - a scenario supported by larger room sizes in the average US home.
As production ramps up at the Guanzhou OLED plant, it is expected that 55-inch single-cut panels will be joined by both the 77-inch and the anticipated 48-inch display sizes.
The Guanzhou plant is an important element of LG’s OLED strategy over the coming years. What do AVForums members think will be the result of its additional panel output? A saturated market? More screen size choice? Lower prices? Or more confusion? Let others know what you think in the discussion thread.
Source: en.th elec.kr
Image Source: The Korea Times
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