Display panel structural upgrading problems of excess capacity remain

Display panel structural upgrading problems of excess capacity remain

Reporter Ni Yu Qing Guangzhou reported

Influenced by international trade frictions and fluctuations in supply and demand relations, the display panel industry has experienced considerable pressure this year.

According to the Blue Book of China's New Display Industry (2017-2018) released on October 24, the global new display panel industry in 2017 is generally stable. However, due to sudden changes in the external economic environment, rapid growth of production capacity, downstream market de-stocking and other factors, the global display panel output value in 2018 is the same as that in 2018. The ratio is down by 7.1%, and the output value is close to US $100 billion.

"The decline in output in 2018 appears to be negative on the surface, but in essence it is a structural upgrade and is positive." Li Yaqin, general manager of Sigmaintell, told reporters on the 25th, "With the iteration of technological innovation and old and new technologies, we believe that the global new display industry is basically stable, and we predict that it will be subject to more AMOLED capacity release, 8K display technology maturity, micro LED technology production and other diversified new technologies. From the beginning of 2020, the output value of new global display panels will rebound. But it is worth pondering whether the panel industry chain in China can benefit from it, whether it is a smooth transition or a sudden rise of a different force.

Technology iteration

In 2018, the 50th anniversary of the invention of liquid crystal, now, in addition to the LCD panel, OLED, micro LED technology has also been applied. In particular, OLED, TV and mobile phones have become the main battleground.

In 2018, "from the technical category point of view, only amorphous silicon (a-Si) LCD output value declined, the other five categories, low-temperature polycrystalline silicon (LTPS) LCD, oxide (Qoxide) LCD, AMOLED and MicroLED output value showed stable or growth." Li Yaqin explained.

With the expansion of capacity, technology update and iteration will become more obvious. According to the classification of group counseling, generation line progress and iterative progress can be divided into three stages.

The first stage is the initial development of flat panel display and the early stage of commercialization, in 1970-1990, South Korea, Japan, Taiwan, China, three areas of obvious expansion. The second stage is the rapid growth of LCD panel capacity, since 2000, LCD panel is an outstanding, but other technologies are beginning to quietly germinate.

Then the industry will enter a third stage, in addition to the LCD panel itself in the deepening of technology improvements, other technologies will go hand in hand. The size of the substrate has evolved from the G1 generation line in 1990s to the 10.5 generation line. Therefore, in the third stage, swarm intelligence believes that it will enter the stage of technological iteration and technological sublimation.

However, there are also difficulties in popularizing new technologies. Take OLED and MicheroLED for example, foldable mobile phone screens are attracting much attention. Samsung and Huawei both disclosed that they already have prototypes, using flexible AMOLED, a type of OLED. However, Li Yaqin told 21st Century Economic Reporter: "We expect that in 2019 and even 2020, the market size of foldable products is still quite small, is in a trial stage."

MicroLED is not too difficult. Li Yaqin told reporters: "For example, if you want to mass-produce a MiroLED screen with FHD resolution, it will need 1920 x 1080 pixels, that is, 2 million pixels. And each pixel is composed of three Micro LED chip, R, G and B, which requires 6 million Mciro LED. A screen requires 6 million micron-sized LED chips, from chip fabrication to transfer fabrication to packaging and chip collocation, which is difficult to produce, so the technology iteration and upgrade process takes a long time.

At the same time, she says, in the short term, the iteration of the panel generation is mainly about the penetration of OLED into LCD (liquid crystal). The current performance is mainly in the mobile market, "For example, we predict that because other Chinese manufacturers besides Samsung will also have more AMOLED production lines in the next year, so including Vincent, Tianma, and BOE, will be in the flexible market next year, the entire AMOLED penetration in the mobile market will show up." Steadily increasing year by year. "

Capacity risk

2019 will usher in a peak production capacity.

Li Yaqin said: "we expect global capacity growth to reach 11% in 2019. Because the capacity of the 10.5-generation line will increase by two in 2019, coupled with the current low profitability of panel manufacturers, the smaller generation lines will be phased out in the next few years, including the 8.5-generation line.

Take AMOLED as an example, there will be more manufacturers next year. Beijing Eastern's 6th generation flexible production line in Chengdu has already been put into production, Mianyang's 6th generation line is expected to be put into production next year, and Chongqing's production line is being planned; Vicino's October 19 announcement said that the 6th generation AMOLED production line will be built in Hefei with a total investment of 44 billion yuan, after Vicino had built 5.5 generation lines and 6th generation lines, and now the 6th generation line is gradually in production. In production, the flexible AMOLED of Hehui Phase I production line will be mass produced in 2018, and the Phase II production line is expected to be put into production in 2019.

"Flexible AMOLEDs will be surplus in the next two years, because the flexible market is growing, but the cost and the price of the end products are too high, so the scale of the product growth is relatively slow, but the capacity is increasing substantially," Li explained to reporters. Although Samsung stopped expanding production, A5 has been delayed indefinitely, but the domestic expansion is still very fast, so the contradiction between supply and demand is obvious. And hard AMOLED supply and demand is relatively healthy.

On October 25, Fan Boyu, a senior research manager at the WitsView, told 21st Century Economic Reporter: "Overcapacity in 2019 should be OK, because China still needs time to adjust to new capacity, but from 2020 onwards, capacity pressures may start to increase. The pressure of price competition will also emerge.

At present, Samsung is still the largest company in the AMOLED market. Fan Boyu said that as the capacity of Chinese manufacturers increases, the proportion will continue to rise. The proportion of AMOLED panels in China will be about 2% in 2017, and it is expected to reach 4% to 5% in 2018.

In addition, the overcapacity of display panels is also expanding, such as E-lnk e-ink screen technology for e-books, ESL technology for electronic tags, ARVR, smart cars and other LCD and OLED demand is growing. However, in the view of a number of industry insiders, the demand of these market segments is not enough to digest capacity, not enough to solve the problem of oversupply.

(Editor: Zhang Weixian)

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