After a massive shift in global LCD production capacity to China, local panel makers are expanding into higher-value LCD products and next-generation OLED products to gain an edge in future competition.
Recently, TCL's multiple LCD production lines have increased the production capacity of small and medium size high value-added IT and vehicle-mounted panels. Section C of guangzhou T9 production line under construction was capped at the end of January, and t5 production line is also accelerating expansion.
"As LCD panel prices continue to fall, panel manufacturers will accelerate the transfer of capacity to higher value-added markets. Boe and TCL Huaxing optoelectronics have deep accumulation in Mini LED, vehicle-mounted display and other relatively high value-added markets." On February 12, CINNO Research senior analyst Liu Yushi told times weekly reporters.
While consolidating the advantages of LCD, OLED, the next generation display technology, is also seen as a new opening of the industry by domestic manufacturers. Sources say THAT TCL is seeking OLED orders from Apple recently, while BOE is changing the use of the phase III production line of ITS B12 plant to win new OLED orders from Apple.
On February 11, times Weekly reporter contacted the staff of the secretary office of the directors of two companies on this news, both sides did not confirm clearly. What is clear, however, is that both companies are aggressively expanding OLED production.
At the end of 2021, BOE invested 46.5 billion yuan to build the 6th generation flexible AMOLED production line project in Chongqing, which started mass production. At present, the output is gradually climbing. TCL is also preparing to expand its T4 flexible OLED production line and build t8 8.5 generation flexible winding OLED display panel production line in Guangzhou.
Lin Zhi, chief analyst of Wit Display, told Times on February 12 that China's OLED material iteration and device structure optimization are slower than South Korea's and lack of mass production experience, but the technological gap is further narrowing. Flexible OLED screens will remain the mainstream in the coming years, and panel manufacturers will focus on OLED technologies such as flexibility, crimping, low power consumption and flexibility.
Grab IT, car LCD
As early as two years ago, industry leaders began to take the lead in the layout of IT panels, vehicle-mounted panels as the representative of high value-added LCD products.
In 2020, IT LCD panel manufacturer CLP Panda is reported to sell the production line, boe and TCL are seen as the two most likely to take over. In the end, BOE won two LCD panel production lines from China Power Panda, thus entering the IT panel market on a large scale. TCL then chose to build its own small and medium size LCD production line to produce IT panels and other products.
In April 2021, TCL issued a private increase announcement that it intends to raise no more than 12 billion yuan for the construction of the t9 production line of the "8.6th-generation Oxide semiconductor New-type display device Production Line Project". The project plans to process about 180,000 glass substrates of 2250mm×2600mm per month. The T9 production line will produce and sell mid-size IT displays such as flat panels, in-car displays and medical professional displays.
TCL, already one step behind Jingdong, needs t9 production line to be completed and put into operation as soon as possible. By the end of 2021, the t9 main plant will be capped, and by the end of January 2022, section C of the project will also be capped. According to media reports, a number of Equipment manufacturers in South Korea won orders from TCL Huaxing Optoelectronics for LCD production equipment to be used in the T9 production line. The production line is expected to reach mass production in the first quarter of 2023.
TCL Huaxing's T5 project, with a total investment of 15 billion yuan for the production of IT panels and other products, is also under construction. At the end of January this year, the T5 project just completed the module workshop and comprehensive power station, and the expansion construction did not stop during the Spring Festival this year.
According to the plan, the T5 project is to expand the production of the sixth generation semiconductor new-type display device, and the production capacity will be increased from 53,000 to 98,000 pieces per month after the expansion. T5 production line produces LTPS TFT-LCD based small and medium size display devices, including vehicle, laptop, tablet.
Liu Yushi told times weekly that the panel production line construction cycle of more than two years, if considering the planning to mass production of the whole process will take longer, capacity expansion needs to be predictable. Boe's acquisition of THE PANDA production line of CLP can realize immediate capacity expansion and complement the existing product line quickly. In contrast, TCL's existing production line has less capacity for the IT market. The planning of IT and vehicle production capacity is based on both optimistic judgment of market demand and consideration of competing for market share.
TCL has a strong determination to enter IT and vehicle-mounted products. TCL science and technology secretary office related person in charge told times weekly reporters, the company hopes that the product structure layout more fully, cut into high value-added medium size field is a development direction of the company. The profitability of medium size screen exceeds that of other production lines and the market demand is healthy.
Prepare for the OLED
OLED, which can display pure black, is thin and flexible, and is considered the next generation of display technology after LCD. It is commonly used in smartphones, tablets and other products, which are in high demand.
Omdia, a research firm, expects the domestic OLED panel market share to rise from 15 percent in 2021 to 27 percent in 2022. The popularity of foldable phones is also increasing demand for flexible OLED panels. Lin zhi believes that global shipments of foldable phones could exceed 60 million units by 2025.
In the face of the future industry tuyere, a number of panel manufacturers recently accelerated the expansion of OLED, secretly competing with each other.
In China, BOE is early in the OLED industry. In January 2021, BOE plans to raise 20 billion yuan. One of the purposes of raising funds is to build the 6th generation AMOLED (flexible) production line project of BOE in Chongqing to produce smartphones and tablet computers.
Boboe secretary office staff confirmed to times weekly reporters, the production line has been completed, just mass production at the end of 2021, the current output is not large, is climbing.
TCL is also expanding OLED production. TCL Huaxing's 6th generation flexible LTPS-AMOLED display panel production line, namely T4 production line, has completed the second and third phase of production capacity construction, which will produce flexible folding screens and explore the under-screen camera technology.
According to the previous announcement, TCL Huaxing's T8 production line in Guangzhou also plans to demonstrate the production of the 8.5 generation winding printed OLED/QLED display panel production line, mainly producing large-size printing winding OLED TV, IT and other products.
TCL science and technology secretary office staff to times weekly reporters said that T4 production line follow-up needs to wait for technological progress and market demand to improve, gradually into a profitable state, T8 production line has been built and in continuous operation.
Not only in capacity, in the fight for high-quality customers and technology competition, panel manufacturers are also competing, their routes are different.
"The domestic OLED competition will be more than one strong situation, BOE has advantages in production capacity, technology, customers and shipments. "Other players also have strong technology and can compete with them by differentiating and targeting specific customers." Liu Yushi said.
Boe has already entered apple's iPhone industry chain, and may be ready to adjust its products and enhance its competitiveness in the near future. It is reported that BOE is preparing to adjust the third production line of B12 plant to supply Apple iPad and other products.
In Liu's view, such adjustment should be related to the OLED panel's high penetration rate and limited growth space in the mid - and high-end smartphone and smart wear market, thus expanding to the middle size.
Others not yet in Apple's supply chain are eyeing it up. It is reported that TCL Huaxing recently set up a team to evaluate the T4 production line in order to prepare to provide OLED panels to Apple iPhone.
Each manufacturer also sends force differentiation technology separately, participate fully in the competition. Taking THE T8 production line that TCL is waiting for mass production as an example, TCL's large-size OLED focuses on printed OLED, trying to catch up with the evaporation process of Korean manufacturers by virtue of the low-cost advantage of printing technology.
Boe has samples in large-size QLED, printed OLED, QD-OLED and WOLED and has not finalized its technology direction, while Huiko is studying various OLED technologies and is in the research and development stage, Lin said. In terms of small and medium size OLED, domestic manufacturers mainly study folding screen, dual-side OLED and other technologies, and accelerate mass production.
As manufacturers speed up production expansion and technology research and development, the OLED market competition will be white-hot.
