End for Samsung LCD panels: End sooner than expected

According to The Korea Times, the South Korean giant will cease production of LCD technology starting in June. Samsung will no longer produce new LCD panels after that date. It was believed that Samsung would extend the grace period till the end of the year. According to knowledgeable sources, the end will come six months earlier than planned.

Prior to the Corona crisis, Samsung had already begun to chart a route for the end, but owing to the situation, the plans were halted and prices were rejuvenated. Samsung Electronics will have to purchase all LCD panels in the future, as is already the case for items under strong price pressure.

The reason for the decision is claimed to be price pressure. Production in South Korea is prohibitively expensive in comparison to competition from China and Taiwan, therefore Samsung Electronics should largely, but not completely, seek panels from BOE in China and AUO in Taiwan. There are also QD OLED panels from our own production, which are likely to be controversial in the group as well. Surprisingly, instead of the expected own VA panels, acquired IPS panels were already spotted in televisions last year.

LG, a South Korean competitor, is likewise aware of the issue but is addressing it by locating plants in lower-cost countries rather than altogether abandoning production and hence vertical integration inside the firm. However, LG purchases panels of various types, including JOLED, as in the Ultrafine Display OLED Pro 32EP950-B.

It is still unclear what will happen to the available LCD capacity. According to previous reports, the capacities are employed for smaller AMOLED screens such as those found in mobile devices. According to more current claims, some of the capacity may be utilized for QD-OLED. According to The Korean Times, no details of an investment proposal have been announced. BOE Technological Group and China Star Optoelectronics Technology are rumored to be interested in acquiring LCD technology tools. Furthermore, Samsung Display is working on Micro-LED, the next big hope in the display business.

According to market research firm Omdia estimates compiled by Daishin Securities, 43-inch LCD panel prices fell by 46 percent between September 2021 and May this year, while 55-inch and 65-inch panel prices fell by 34 percent during the same period. Samsung's market share has plummeted from 22 percent in 2014 to 2 percent now as a result of sustained pricing pressure from Chinese competition.

Only a modest price increase in the aftermath of the Corona crisis delayed the end, but Samsung Display sold its LCD television screen production in Suzhou, China, to competitor TCL China Star Opto-electronics Technology as early as April 2021. Analysts have already gone one step further, discussing the implications of the end of in-house LCD manufacture on Samsung Electronics, where the panels are turned into completed products.