Local flat-panel makers have increasingly shifted their capacity to value-added and niche segments as they face headwinds from a supply glut in the industry, but overall panel prices are unlikely to see a meaningful recovery in the next one to two years, Yuanta Securities Investment Consulting Co (元大投顧) said in a note on Friday.
While companies like AU Optronics Corp (友達光電) and Innolux Corp (群創光電) have extended their reach to gaming monitors, public information displays and automotive displays, and pinned their hopes on mini and micro-LEDs to boost shipments, panel prices would remain under pressure for several quarters, Yuanta said.
Yuanta’s warning came after media reported that Samsung Electronics Co was planning to convert its LCD Fab L8-1 into organic LED (OLED) production and has reduced capacity at its Fab L8-2-1 to 30,000 units per month, from 90,000 units.
Some Chinese panel makers have reportedly cut their LCD capacity or delayed the mass production at new LCD plants to avoid further losses.
“Our channel checks suggest this could alleviate the pain, but will not reverse the overall industry downtrend, as more than six Gen-8 or above panel factories will come online for Chinese makers in the next 1 to 2 years,” Yuanta said.
“These factory plans are all driven by government policy, meaning that the factory construction plans could be postponed, but will not be canceled, and oversupply will continue to loom over the panel industry,” it said.
Data and analytics provider IHS Markit’s figures showed that panel prices have dropped 5 to 10 percent this month from last month across all TV sizes.
Market researcher TrendForce Corp (集邦科技) has said that prices of medium and large LCD panels would continue falling this quarter, due to the US-China trade dispute.
Separately, AU Optronics on Friday said that it would unveil several new display technologies at this year’s Touch Taiwan trade exhibition to demonstrate its innovative strengths.
The new technologies include a 17.3 inch OLED display applied by inkjet printing technology, a 5.9 inch active-matrix organic LED display that can be folded inward or outward, a 12.1 inch full-color micro-LED automotive display, and the world’s first optical in-cell fingerprint low-temperature polysilicon (LTPS) display, AUO said in a statement.
Innolux plans to introduce its new public information displays using mini-LED technology, as well as new LTPS displays for handsets and ultra-high-definition 8K LCD TV panels, the company said earlier last week.
Lextar Electronics Corp (隆達電子), an LED manufacturing arm of AU Optronics, is also to present a new series of mini-LED ready for mass production and new micro-LED technology at the trade show.
Touch Taiwan is to run from Wednesday to Friday at the Taipei Nangang Exhibition Center.
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